On Thursday, April 16, gold prices recorded a significant increase. While tensions persist around the Strait of Hormuz, renewed efforts to pursue a diplomatic resolution to the Iran conflict have alleviated inflation concerns, contributing to the rally.
Market Drivers: The recent notable rebound in gold prices is heavily influenced by geopolitical developments. According to informed sources, the United States and Iran are considering extending a ceasefire by two weeks to buy time for negotiations aimed at ending the conflict. Although initial talks in Pakistan yielded no concrete results, both parties have "agreed in principle" to continue diplomatic efforts. U.S. President Trump stated that the U.S.-Iran war is "nearing its end" and suggested that Washington "could potentially" reach a peace agreement with Tehran before King Charles III's visit. However, the situation remains complex with ship passage through the Strait of Hormuz still obstructed.
Technical Analysis - Daily Chart: On the daily chart, gold surged to $4,871 yesterday before experiencing a sharp pullback, closing as a medium bearish candle with a long upper shadow. This pattern signals a short-term top formation, leading to immediate pressure below the 5-day moving average (around $4,825) today. The market is currently in a phase of bullish momentum consolidation, with no signs of a trend reversal. The MACD indicator shows continued contraction of the red histogram; while bullish momentum above the zero line has weakened, it has not formed a death cross, further confirming the trend remains intact. The RSI has retreated from the overbought zone of 78 to 58, indicating some exhaustion of bullish strength but remaining in a neutral-to-strong range, not yet entering bearish territory. For support levels, primary support lies at $4,800-$4,810, near the day's low, which aligns with a dense trading area and a key psychological level. Secondary support is at $4,750-$4,755, corresponding to the 10-day moving average and the 0.5 Fibonacci retracement level, representing crucial support for the medium to long-term bullish trend. On the resistance side, primary resistance is at $4,850-$4,855, the upper boundary of the weekly consolidation range and an area of concentrated selling pressure, making a breakout challenging. Strong resistance is at $4,870-$4,871, yesterday's high and a阶段性 peak; a breakout here would likely require a significant catalyst.
Technical Analysis - 4-Hour Chart: The 4-hour chart aligns with the short-term consolidation seen on the daily chart, showing price action within a broad range of $4,786 to $4,871. Short-term moving averages (5, 10, 20-period) are converging and flattening, offering no clear directional bias, which is characteristic of a trend consolidation phase, digesting yesterday's sharp reversal. After forming a minor top yesterday, the price found support at today's low of $4,810.7 and staged a modest rebound, with consecutive small bullish candles indicating underlying buying interest. However, the rebound lacks significant volume, suggesting bullish momentum remains insufficient, consistent with the weakening momentum signal on the daily chart. Oscillators show the KDJ forming a golden cross from low levels, with the J-value recovering from oversold territory (below 20) to 45, indicating a gradual accumulation of short-term rebound momentum. The STOCH indicator is rising from oversold levels into neutral territory, signaling continued weakening of bearish momentum and suggesting the ongoing consolidation is likely to persist.
Technical Analysis - 1-Hour Chart: The 1-hour chart depicts a narrow, slightly bullish consolidation. After probing the low of $4,810.7 in the morning session, the price oscillated higher with successively higher peaks. The 5 and 10-period moving averages have turned upward, forming a golden cross that provides dynamic support. The price is moving within a short-term ascending channel, with the lower boundary at $4,815 and the upper boundary at $4,838, defining a clear near-term range that aligns with the converging pattern on the 4-hour chart. Momentum indicators show the RSI recovering to around 55, moving out of weak territory with bulls holding a slight edge. The MACD has formed a golden cross above the zero line with a slight expansion of the red histogram, indicating a mild release of short-term rebound momentum. However, resistance from the daily and 4-hour charts limits the upside potential, with no signs of a unilateral trend emerging. For support, $4,815-$4,820 corresponds to the channel's lower boundary and the current price area, offering relatively strong support. $4,805-$4,810 aligns with the day's low and connects with daily chart support; holding above this level could allow the short-term rebound to continue. For resistance, $4,835-$4,838 is the channel's upper boundary and the day's high, acting as a key near-term cap. $4,845-$4,850 corresponds to daily chart resistance; a break above could target the stronger daily resistance level.
Trading Strategy: Focus on trading within the core $4,800-$4,840 consolidation range intraday, avoiding chasing rallies or selling into dips recklessly. For long positions, consider light entry between $4,812-$4,817, with a stop loss at $4,795, targeting $4,835-$4,840. A break above this target could extend gains towards $4,850. For short positions, consider light entry between $4,835-$4,840, with a stop loss at $4,855, targeting $4,820-$4,815. A break below this target could see a move towards the key support at $4,800.
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