During Wednesday's Asian trading session, gold prices maintained a firm and volatile trend, trading near $4,625. The primary drivers behind the upward movement in gold include persistent tensions in the Middle East and a temporary weakening of the U.S. dollar. Against the backdrop of ongoing strategic competition between the United States and Iran over control of key energy passageways, market demand for safe-haven assets has remained resilient.
U.S. Defense Secretary Pete Hagsteth indicated that the ceasefire with Iran "is not yet over." This statement reinforced market expectations that conflicts could resurge, while the U.S. dollar weakened following the news, providing support for dollar-denominated gold. Typically, a weaker dollar reduces the cost of holding gold, attracting capital inflows into the precious metals market.
However, despite the supportive factors, the upside for gold prices remains limited. The situation in the Middle East remains highly complex, with ceasefire expectations on one hand and continued conflict on the other. Public reports indicate clashes involving vessels near the Strait of Hormuz, along with missile and drone attacks targeting the United Arab Emirates. UAE authorities stated that approximately 20 incoming targets were successfully intercepted, indicating that regional security risks remain elevated. The Strait of Hormuz handles about 20% of global seaborne crude oil shipments, and its stability directly impacts worldwide energy markets. Any escalation in tensions could raise inflation expectations, indirectly influencing gold prices. Conversely, if conflicts ease, safe-haven demand may decline, putting downward pressure on gold.
From a market structure perspective, gold's current trend reflects a balance between safe-haven support and monetary policy expectations. Investors are monitoring geopolitical risks while paying closer attention to the impact of U.S. macroeconomic data on the future path of interest rates. Market focus is gradually shifting toward upcoming employment figures.
Market expectations suggest that U.S. non-farm payrolls may increase by approximately 60,000 in April, with the unemployment rate expected to remain around 4.3%. A slowdown in job growth could strengthen expectations of a shift in interest rate policy, which would benefit gold. Conversely, strong data may weigh on gold prices.
Technically, gold's daily chart continues to show a high-level volatile uptrend, with an overall bullish bias, though upward momentum has weakened. The current price is trading above the key psychological level of $4,600, with short-term resistance near $4,650 and $4,700. Support levels are concentrated around $4,550 and $4,500. A sustained break above $4,600 could open further upside, while a drop below $4,550 may lead to a corrective phase.
On the 4-hour chart, gold is moving within a rising channel but shows signs of short-term momentum divergence. Moving averages are converging, indicating that market direction remains unclear. The MACD indicator is near the zero line, suggesting a relative balance between bullish and bearish forces. A breakout above $4,650 could trigger renewed bullish momentum, while a drop below $4,500 may prompt a technical pullback.
The gold market is currently influenced by multiple factors. On one hand, uncertainty in the Middle East provides safe-haven support. On the other hand, employment data and interest rate expectations will be key in determining the medium-term trend. The direction of the U.S. dollar and monetary policy outlook remain core variables affecting gold prices. If economic data weakens and prompts a policy shift, gold may maintain its strength. However, if risk sentiment improves and data remains strong, gold could face pressure. Overall, gold is expected to remain volatile with a slight bullish bias in the short term, while its medium-term trajectory will depend on the interplay of macroeconomic and geopolitical developments.
Comments