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Gold Price Trims Gains as Hawkish Central Banks Offset Weaker USD
Gold prices trimmed part of their intraday gains after struggling to sustain momentum above the $4,600 level, retreating from a one-and-a-half-week high reached during the Asian session. Reports that Donald Trump may end the military campaign against Iran—despite the Strait of Hormuz remaining partially closed—triggered a corrective pullback in crude oil prices.
This development eased inflation concerns and kept US Treasury yields subdued, prompting some profit-taking in the US Dollar (USD) and providing limited support to gold prices.
Technical Analysis: Short-Term Bearish Bias Emerges
From a technical perspective, gold shows a cautiously bearish short-term bias as prices trade below the 38.2% Fibonacci retracement of the decline from the monthly swing high.
Additionally, gold remains below the 100-day Simple Moving Average (SMA), signaling that while the broader uptrend is still intact, near-term pressure is building. Meanwhile, the 200-day SMA continues to trend higher, reinforcing the long-term bullish structure despite recent pullbacks.
The Relative Strength Index (RSI) has rebounded from oversold territory to around 41, indicating weakening bearish momentum but limited upside strength. At the same time, the MACD remains in negative territory, confirming fading bullish momentum.
- Immediate resistance: $4,592 (38.2% Fibonacci level)
- Next resistance: $4,637 (100-day SMA)
- A daily close above this level could open the door toward $4,747 (50% retracement)
On the downside:
- Initial support: $4,470 (recent low)
- Key support: $4,401 (23.6% retracement)
- A break below this zone could expose $4,200–$4,150, with the 200-day SMA near $4,129 acting as a major support level
As long as gold holds above the 23.6% retracement and 200-day SMA, the broader bullish outlook remains intact. However, a breakdown below these levels would strengthen the current bearish bias.
Geopolitical Risks and Fed Policy Cap Gold Upside
Iran’s reluctance to engage in direct negotiations with the US highlights fragile diplomatic progress. At the same time, continued US military deployment in the region adds uncertainty and dampens hopes for rapid de-escalation in the Middle East.
This backdrop could support crude oil prices and keep inflation risks elevated, reinforcing expectations of higher global interest rates.
Hawkish signals from major central banks, particularly the Federal Reserve (Fed), continue to limit upside potential for non-yielding assets like gold.