On April 27, our previous analysis suggested that the unclear prospects for US-Iran negotiations were supporting an oil price rebound. Concerns over high inflation dampened expectations for Federal Reserve interest rate cuts, putting pressure on gold prices and leading to a consolidative trend. Short-term technical indicators also pointed to gold being under pressure and adjusting. Consequently, for trading strategies, it was recommended to watch for support at $4,657 and $4,600, with resistance levels at $4,718, followed by $4,750 and $4,800.
Subsequent market movements showed that before the US trading session last Friday, gold encountered resistance at $4,718, fell to find support at $4,690, and then resumed its rebound. During the US session, it reached a daily high of $4,740 before encountering resistance and retreating, stabilizing around $4,705 before the close. This Monday, gold opened slightly lower and continued to decline, currently trading around $4,684. Overall, gold's fluctuations have been more subdued than anticipated, with prices maintaining a pressured and consolidative pattern in the short term.
Analysis indicates that the US continued its maritime blockade against Iran, while Iran made lifting the blockade a precondition for negotiations, refusing to participate in the second round of talks and closing the Strait of Hormuz. This led to a rebound in oil prices, which weighed on gold. However, as both sides remain at an impasse but avoid escalation, and with reports that Iran's Foreign Minister arrived in Pakistan last Friday on a trip related to advancing negotiations, oil prices experienced a brief pullback, providing some support to gold. Over the weekend, no direct US-Iran talks occurred. Iran's Foreign Minister explicitly stated there were no plans for direct negotiations, leading the US to cancel its delegation's trip to Pakistan. Both sides are now exchanging proposals through Pakistan. Looking ahead, developments in the US-Iran situation will directly influence short-term gold price movements and require close monitoring.
On the daily chart, gold was under pressure and consolidated last week. Although the short-term decline has been relatively limited, the rebound has also shown clear weakness. Key support levels to watch are last week's low of $4,657, followed by the psychological level of $4,600. Resistance can be observed at the daily Bollinger Band midline around $4,730, and then the weekly Bollinger Band midline near $4,770. The 5-day moving average has formed a bearish crossover, the MACD indicator is nearing a bearish crossover, and both the KDJ and RSI indicators show bearish crossovers, indicating increased short-term downside risk for gold.
Intraday gold outlook: The uncertain prospects for US-Iran negotiations, combined with oil prices maintaining relatively high and volatile levels, and inflationary pressures suggesting the Fed may maintain higher interest rates for longer, are keeping gold prices under pressure and within a range. A range-trading strategy is recommended. Support levels to monitor are $4,657 and $4,600, while resistance levels are $4,730 and $4,770.
Comments