GOLD looks to regain $4,600 on US-Iran peace deal prospects
Gold rebounds sharply toward $4,600 in Monday’s Asian trades, following a down week.
The US Dollar tumbles on hopes for a US-Iran peace deal, the Strait of Hormuz reopening.
Gold buyers look to take out the $4,610-$4,650 resistance zone, but bearish RSI warrants caution.
Gold is staging a solid comeback in early Asia on Monday, recapturing the $4,550 barrier on its way to $4,600, while reversing last week’s decline.
The US Dollar (USD) is wilting on fresh hopes for a peace deal between the United States (US) and Iran, allowing the bullion to recover ground.
Over the weekend, several American media outlets reported that the two countries were close to signing a deal that involves a 60-day ceasefire extension and an in-principle agreement to the reopening of the Strait of Hormuz.
Despite the evolving US-Iran peace talks, optimism prevails across the financial markets that a potential deal could be reached in the coming days, which could lead to the clear passage of maritime traffic through the Strait.
The renewed hopes of the Strait reopening have already smashed Oil prices to over 5% and fuelled a risk-on market environment.
With further progress on the talks, inflation concerns could ease alongside the retracement in Oil prices, thereby alleviating the pressure of the US Federal Reserve (Fed) to opt for an interest rate hike this year.
This narrative is boding well for riskier assets and the non-yielding Gold at the expense of the current go-to safety bet and the reserve currency, the USD.
In the day ahead, the US-Iran headlines will be closely followed for fresh trading incentives in the Gold price. However, the bright metal could be subject to intense volatility and exaggerated moves as the US stock and bond markets remain closed this Monday for Memorial Day.
Daily technical analysis
In the daily chart, XAU/USD trades at $4,578.87. The metal remains capped in the short term, with price lodged below the 21-day, 50-day and 100-day simple moving averages, which together suggest that rallies are likely to face supply before the broader uptrend resumes. The 14-day Relative Strength Index near 46 keeps momentum mildly negative, hinting that recent bounces are corrective rather than the start of a sustained advance.
On the topside, initial resistance emerges at the 21-day SMA around $4,608.80, followed by the 50-day SMA near $4,658.06, while the 100-day SMA at roughly $4,800.98 marks a higher barrier if buyers regain traction. On the downside, prior trend-line (falling wedge resistance-turned-support) interaction and nearby structure leave the broader support zone leaning toward the mid-$4,300 area, with the 200-day SMA at about $4,382.09 acting as a more substantial floor should sellers extend the current pullback.
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GOLD looks to regain $4,600 on US-Iran peace deal prospects
Gold is staging a solid comeback in early Asia on Monday, recapturing the $4,550 barrier on its way to $4,600, while reversing last week’s decline.
The US Dollar (USD) is wilting on fresh hopes for a peace deal between the United States (US) and Iran, allowing the bullion to recover ground.
Over the weekend, several American media outlets reported that the two countries were close to signing a deal that involves a 60-day ceasefire extension and an in-principle agreement to the reopening of the Strait of Hormuz.
Despite the evolving US-Iran peace talks, optimism prevails across the financial markets that a potential deal could be reached in the coming days, which could lead to the clear passage of maritime traffic through the Strait.
The renewed hopes of the Strait reopening have already smashed Oil prices to over 5% and fuelled a risk-on market environment.
With further progress on the talks, inflation concerns could ease alongside the retracement in Oil prices, thereby alleviating the pressure of the US Federal Reserve (Fed) to opt for an interest rate hike this year.
This narrative is boding well for riskier assets and the non-yielding Gold at the expense of the current go-to safety bet and the reserve currency, the USD.
In the day ahead, the US-Iran headlines will be closely followed for fresh trading incentives in the Gold price. However, the bright metal could be subject to intense volatility and exaggerated moves as the US stock and bond markets remain closed this Monday for Memorial Day.
Daily technical analysis
In the daily chart, XAU/USD trades at $4,578.87. The metal remains capped in the short term, with price lodged below the 21-day, 50-day and 100-day simple moving averages, which together suggest that rallies are likely to face supply before the broader uptrend resumes. The 14-day Relative Strength Index near 46 keeps momentum mildly negative, hinting that recent bounces are corrective rather than the start of a sustained advance.
On the topside, initial resistance emerges at the 21-day SMA around $4,608.80, followed by the 50-day SMA near $4,658.06, while the 100-day SMA at roughly $4,800.98 marks a higher barrier if buyers regain traction. On the downside, prior trend-line (falling wedge resistance-turned-support) interaction and nearby structure leave the broader support zone leaning toward the mid-$4,300 area, with the 200-day SMA at about $4,382.09 acting as a more substantial floor should sellers extend the current pullback.
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