gold prices have maintained a firm stance near the $4,700 level during Thursday’s Asian trading session, managing to halt the recent retracement that pulled the commodity from a three-week high. Market uncertainty related to the US-Iran ceasefire negotiations continues to weigh on risk sentiment, bolstering the US dollar’s status as a safe haven and exerting downward pressure on gold . Nonetheless, the Federal Reserve’s dovish tone continues to temper aggressive US dollar positioning, thereby limiting the downside potential for gold , which does not generate yields.
Geopolitical developments in the Middle East have contributed to market volatility. Israel conducted extensive airstrikes across Lebanon, citing that the ceasefire agreements did not extend to Lebanon due to Hezbollah’s involvement. Simultaneously, the US confirmed Lebanon was not included in the recent Iran-US ceasefire deal. Iran responded by halting shipping traffic through the Strait of Hormuz and issued warnings that it might withdraw from the ceasefire if hostilities persist against Lebanon. These escalation fears serve to support the US dollar and suppress gold prices further.
In the monetary policy sphere, minutes from the Federal Open Market Committee’s March meeting revealed a stance favoring higher interest rates for an extended period. With rising concerns about inflation fueled by energy shocks in the Middle East, policymakers expressed a cautious approach, emphasizing the possibility of rate cuts in the coming years—though no precise timetable was offered. This outlook restrained a potential recovery in the US dollar from recent lows, thereby providing limited support to gold .
Market participants remain cautious ahead of key economic indicators, including the upcoming release of the US Personal Consumption Expenditures (PCE) Price Index, the Fed’s preferred inflation measure, which could influence future policy direction. The release of the US Consumer Price Index (CPI) on Friday is also anticipated to shed more light on inflation trends and USD movements, potentially impacting gold prices accordingly.
From a technical perspective, gold appears vulnerable. The price remains below the 200-period simple moving average and the 50% Fibonacci retracement of the recent decline, indicating a bearish trend. Momentum indicators such as the MACD have turned negative, and the Relative Strength Index hovers around neutral territory, suggesting waning bullish momentum. Immediate support levels are identified at the 38.2% Fibonacci retracement around $4,604, with further support at $4,412 and $4,102. On the upside, resistance is seen at $4,758, with stronger barriers near $4,895–$4,914, where key moving averages and Fibonacci levels align. Sustained penetration above the $5,000 mark would be necessary to ease bearish pressures and signal potential upside momentum.
