How should investors navigate the ongoing tug-of-war between bulls and bears early this week? On April 6, as the Middle East conflict entered its sixth critical week, the U.S. President issued another stern ultimatum, demanding that Iran reopen the Strait of Hormuz or face devastating consequences. This development continues to support oil prices at elevated levels in the short term, while simultaneously exerting downward pressure on gold through inflation and interest rate channels. However, if the conflict prolongs further and leads to signs of economic slowdown, or if diplomatic mediation achieves a substantive breakthrough, gold's safe-haven premium may reemerge. Investors should closely monitor developments in the Strait of Hormuz, signals from the Federal Reserve's policy, and key economic data. In the current high-volatility environment, gold remains a part of long-term strategic asset allocation, particularly for hedging against currency depreciation and systemic risks. However, short-term traders should remain cautious of the interplay between the U.S. dollar and oil prices, avoiding blind chasing of highs or bottom-fishing.
From a technical perspective, on the daily chart, gold prices closed with a small bearish candlestick featuring a long lower shadow, indicating a potential continuation pattern within a downtrend. Prices are trading below the 5-day and 20-day moving averages, forming a bearish alignment. The MACD histogram shows a slight contraction in the green bars but remains below the zero line, suggesting that bearish momentum has not fully dissipated. Key support is observed at $4,500, with resistance at $4,800. On the 4-hour chart, the Bollinger Bands are contracting, indicating consolidation, while the moving average system maintains a bearish alignment. The MACD continues to show a golden cross but with weak momentum, and the KDJ indicator has entered the oversold zone without showing a reversal, suggesting a high probability of continued range-bound trading between $4,550 and $4,700. On the 1-hour chart, the Bollinger Bands are opening downward, with gold prices trading below the middle band. The MACD red bars are shrinking, and the RSI has rebounded to a neutral-to-weak range, indicating a lack of strength in short-term rebounds. Traders should remain vigilant for a potential breakdown of support levels and consider short opportunities if rebounds encounter resistance. Overall, the technical outlook is bearish, with short-term consolidation expected, awaiting a clear breakout signal.
Support and resistance levels: On the daily chart, key support is at $4,500, followed by $4,600, with major resistance at $4,800. On the 4-hour chart, support is at $4,550, and resistance is at $4,700, indicating clear range-bound characteristics. On the 1-hour chart, short-term support is at $4,580, with resistance at $4,670. Overall, support levels should be closely defended; a break below key support may further open up downside space, while a breakthrough above resistance could alleviate short-term bearish pressure.
Based on the above analysis, it is recommended to consider short positions in the $4,665–$4,670 range, with a stop-loss above $4,680, targeting $4,600–$4,580. For long positions, consider buying near $4,550 on pullbacks.
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