On Monday, April 27, international gold prices surged higher before retreating, fluctuating below the $4,700 per ounce mark, with the daily candlestick chart forming a small bearish pattern. During the Asian trading session on Tuesday, April 28, spot gold experienced a sharp decline, briefly falling below $4,630 per ounce, marking a daily drop of over 1%.
Overall, since falling below the $4,800 level, gold prices have been oscillating repeatedly around $4,700 for several consecutive days. Against the backdrop of stalled US-Iran negotiations, expectations are for gold to maintain a range-bound pattern. From a technical perspective, there is a risk of further declines.
On the fundamental front, US-Iran talks have reached a stalemate. Iran has explicitly refused to negotiate under "blockade and pressure," proposing a three-phase negotiation framework. While regional tensions continue to fluctuate, their impact on short-term gold price movements remains relatively limited.
Regarding monetary policy, the Federal Reserve's interest rate meeting this week is highly likely to keep rates unchanged. As this is Chair Powell's final appearance, his remarks are expected to have limited market impact regardless. The uncertainty surrounding the Fed's independence under the upcoming Wash era and potential restructuring of its monetary policy framework could be key factors influencing gold's medium-term trajectory.
Furthermore, central bank decisions from the Bank of Japan, Bank of Canada, Federal Reserve, European Central Bank, and Bank of England are scheduled this week. Markets broadly anticipate no policy changes, but investors are closely watching for any statements regarding inflation risks stemming from Middle Eastern energy market disruptions.
In summary, neither Middle Eastern developments nor central bank actions currently provide clear directional guidance. Under these circumstances, the precious metal is likely to persist in its consolidation pattern.
Technically, weekly charts indicate that gold has completed a preliminary transition from rebound to retreat. The 5-week and 10-week moving averages, converging with the middle Bollinger Band around the $4,730-$4,810 range, form strong resistance. Last week's candlestick fully erased the prior week's gains, signaling a temporary halt to the rebound and suggesting increased probability of either continued correction or high-level sideways movement over the next two weeks. With China's Labor Day holiday approaching, market participation is expected to turn more cautious.
On the daily chart, short-term moving averages are intertwined, with prices currently trading below the cluster. The 5-day moving average has descended to the psychologically important $4,700 level, acting as resistance. The 10-day moving average aligns with the daily Bollinger Band midline around $4,735-$4,745, representing the recent trading range's upper limit and continuing to exert pressure. Over the past week, gold has held above the $4,640-$4,660 support zone. A breakdown below this range would signal continuation of the corrective phase, potentially leading to further tests of the $4,600 and $4,540 levels.
Technical indicators show the daily MACD's red bars continuing to shorten, with potential to turn negative, indicating short-term weakness. Meanwhile, the KDJ indicator formed a bearish crossover and has been declining for a week, with the J-value approaching oversold territory. This suggests possible further bottom-testing for gold prices. A reversal signal from this indicator would be needed to indicate potential end of the correction.
Comprehensive analysis suggests gold is currently in a corrective phase following its peak near $4,889. Medium-term technical targets point toward the $4,500 psychological level. Immediate support lies at the $4,640-$4,660 range and the $4,600 mark. The prevailing trend remains one of repeated bottom-testing, requiring patience for clear stabilization signals. Intraday resistance is positioned at $4,700 and the $4,735-$4,745 zone.
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