Gold Stays Range-Bound as Rate Pressure and Geopolitics Weigh

Gold (XAU/USD) did not build significantly on its bounce from around $4,570 on Friday and opened the week slightly lower, marking a second day of modest decline. The main pressure comes from expectations that global interest rates will remain higher for a longer period, which usually reduces appetite for non-yielding assets like gold. A stronger US dollar is also weighing on gold, although selling is currently limited.
Markets are paying more attention to rising energy prices driven by geopolitical tensions, which could push inflation higher again. This has boosted expectations that the Federal Reserve will maintain a hawkish stance. Oil prices rose after Donald Trump warned of possible action against Iran if the Strait of Hormuz stays blocked. Iran responded by indicating the route might reopen under certain compensation terms. Additional risks to key trade routes like the Bab el-Mandeb Strait have raised concerns about supply disruptions, supporting oil prices and inflation expectations.
Strong US Nonfarm Payrolls data reinforced the view that the economy remains resilient, giving the Fed more reason to keep rates elevated. This continues to support the US dollar and puts a cap on gold’s gains.
Despite these pressures, gold remains above the $4,600 level and is technically stable. A clear break below this support is needed to signal a deeper pullback. Traders are now focused on the US ISM Services PMI for short-term guidance, while trading volumes are expected to stay light due to holiday conditions.
Technical View
Gold is still trading within a rising channel on the 4-hour chart after rebounding from mid-March lows. The higher lows suggest buyers are still active, but the upward momentum is fading. Price was rejected near the $4,800–$4,830 resistance zone, indicating sellers are defending those levels.
Currently, price is around $4,600, positioned in the middle of the range, which shows a neutral phase.
Key levels:
Resistance: $4,708 and $4,830
Support: $4,499 and $4,189
A move above $4,830 would suggest further gains, while a drop below $4,499 could lead to a deeper correction.
Overview: The trend remains slightly bullish, but momentum is slowing. Price is consolidating, and the next move will depend on a breakout above or breakdown below key levels.
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