21-day SMA is yet again the level to beat for XAU/USD bulls

• Gold hesitates above $4,100 early Friday, eyeing a weekly loss.
• The US Dollar extends on less hawkish Fed Minutes, fresh US-Iran optimism and the USD/JPY slide.
• Gold’s daily technical setup still favors bears unless the 21-day SMA is recaptured on a sustained basis.

Gold is defending the $4,100 level early Friday, trying hard to capitalize on this week’s rebound from four-day lows of $4,022 even as tensions in the Middle East appear to have somewhat eased.

Despite the recent upswing, Gold remains on track to book a weekly loss, undermined by the revival of inflationary concerns following a renewed wave of hostilities between the United States (US) and Iran, which drove Oil prices to two-week highs.

However, the latest development on the Middle East front shows a US official stating that “the United States is still committed to finding a resolution, and technical talks continue,” easing tensions and diminishing the US Dollar (USD) safe-haven appeal.

The Greenback also bears the brunt of the fresh decline in the USD/JPY pair as the Japanese Yen (JPY) rallies hard after announcements of fiscal and financial reforms by the local authorities.

The latest leg down in the buck is allowing Gold to stay afloat heading toward data-light sessions ahead. Therefore, bullion traders will take cues from the broader market sentiment, while paying close attention to any US-Iran updates.

Markets could resort to repositioning their Gold trades before next Tuesday’s Consumer Price Index (CPI) data release from the US, which could provide fresh signals on the US Federal Reserve’s path forward on interest rates, particularly after Wednesday’s less hawkish Fed June meeting Minutes.

The Minutes showed that only "a few" participants saw the case for raising rates, while a majority of the policymakers did not see the immediate need to hike, even though they acknowledged elevated inflation due to the war's effect.

In the daily chart, XAU/USD trades at $4,127.06, extending a bearish bias as price holds below all major moving averages. The 21-day Simple Moving Average (SMA) at roughly $4,135.77 is the nearest cap, with the 50-day SMA around $4,353.07 and the longer-term 200-day and 100-day SMAs clustered above $4,490 and $4,590, respectively, reinforcing a broadly pressured structure. The Relative Strength Index (14) at 45.01 sits just below the midpoint, hinting at subdued downside momentum rather than an oversold extreme. Further, with the Death Cross in play, risks remain skewed to the downside for the bright metal.

On the topside, initial resistance is seen at the 21-day SMA near $4,135.77, with further barriers at the 50-day SMA around $4,353.07. Beyond that, the 200-day SMA at about $4,493.68 and the 100-day SMA near $4,593.41 form a wider supply band that would likely cap any stronger rebound while price trades below them. On the downside, the lack of nearby moving-average supports in the dataset leaves spot vulnerable to fresh lows, with traders likely to watch recent price floors and intraday pivots for the next meaningful demand zone.