FX.co ★ XAU/USD, GOLD

Gold (XAU/USD) maintained its upward trajectory during Wednesday’s Asian trading session, hovering just above the $5,150 mark with a daily gain of approximately 1.30% as the global financial landscape grapples with extreme geopolitical instability. The primary catalyst for this bullish sentiment is the intensifying conflict in the Middle East, which has forced investors into a defensive posture. Market participants are deeply unsettled by the rhetoric coming from the White House, as US President Donald Trump has indicated that military operations against Iranian targets could span several weeks, with strikes persisting until strategic objectives are met. This environment of heightened military engagement has severely dampened appetite for riskier assets, leaving equity markets in a state of retreat while bolstering the traditional appeal of gold as a premier safe-haven store of value. The sense of urgency in the precious metals market is underscored by the physical threat to global energy supplies, most notably the closure of the Strait of Hormuz. As one of the world’s most critical maritime chokepoints, its obstruction has propelled crude oil prices to levels not seen since mid-2015. Iran’s retaliatory strikes against energy infrastructure and its explicit warnings that regional oil exports could be halted entirely have raised the specter of a systemic energy crisis. Such a supply-side shock carries heavy implications for global monetary policy. The resulting surge in energy costs is expected to exert significant upward pressure on inflation, potentially complicating the Federal Reserve’s previous trajectory toward monetary easing. If the Fed is forced to pause or even reverse its planned interest rate cuts to combat this "imported" inflation, the US dollar’s status as the dominant reserve currency would likely be further entrenched. This dynamic creates a complex ceiling for gold; because bullion is a non-yielding asset, the strength of the US Dollar Index (DXY)—which is currently trading near three-month highs—acts as a gravitational pull, keeping gold prices struggling to make a decisive break above the $5,200 threshold. Consequently, many institutional traders are adopting a "wait-and-see" approach, looking for a stabilized daily close above $5,200 before committing to a more aggressive long-term bullish bias. While the market is technically awaiting the release of the ADP private sector employment report and the ISM services PMI, these data points are being largely overshadowed by the war in the region, which remains the undisputed driver of price action. From a technical perspective, the short-term outlook for gold has shifted toward a more cautious, neutral-to-bearish stance following its retreat from the upper boundaries of its established ascending channel. Although the rally since early February remains intact on a broader scale, the recent rejection at the $5,380 level has sapped some of the immediate momentum. The price is currently testing the lower boundary of its ascending channel near $5,025, a level that coincides closely with the 200-period Simple Moving Average (SMA) on the four-hour chart. The Relative Strength Index (RSI) has recently recovered to 43 after dipping toward oversold territory, suggesting that while the downward pressure is easing, the bulls have not yet regained full control. Similarly, the MACD indicator remains positioned below the signal line, reflecting a loss of confidence in the immediate uptrend. Traders are currently eyeing the $5,130 to $5,140 range as critical initial support. A breach below this zone could expose the $5,030 level, which serves as a major technical floor; falling below that would likely signal a more profound corrective phase toward $4,980. Conversely, on the upside, immediate resistance is pegged near $5,210 and $5,260. A sustained move above $5,260 would be necessary to negate the current bearish pressure and reopen the path for a retest of the $5,380 highs.