On April 20, our analysis last Friday indicated that despite easing Middle East tensions and falling oil prices alleviating inflation concerns—which supported gold prices—significant uncertainty in the Middle East and expectations of sustained high interest rates from the Federal Reserve limited gold's rebound. Short-term technical indicators also suggested a need for a rebound in gold, but with clear near-term resistance. Therefore, we recommended monitoring support levels at $4,750 and $4,720, and resistance levels at $4,838 and $4,870.
Subsequent market movements showed that after opening in the Asian session last Friday, gold stabilized at $4,767 before rising to encounter resistance at $4,806. The breakout occurred after the U.S. market opened, pushing gold to a high of $4,891 before it retreated and closed at $4,831. This Monday, gold opened with a gap down, finding support at $4,758, and is currently trading with a slight rebound near $4,786. Overall, last Friday’s rally and subsequent pullback aligned with our expectations, while Monday’s gap down was primarily driven by escalating Middle East tensions over the weekend.
Analysts note that last week, remarks from former U.S. President Donald Trump about the Iran war being over and potential renewed negotiations weighed on international oil prices, which hit a one-month low, easing inflation worries and supporting gold’s rebound to a one-month high. However, continued U.S. blockades of the Strait of Hormuz and Iran’s announcement of its closure—with no vessel passages recorded on the 19th—along with Iran’s denial of renewed talks and preparedness for renewed conflict, raised concerns over negotiation prospects. This pushed oil prices and the U.S. dollar higher from one-month lows, causing gold to pull back after its rally. Gold’s decline was limited, however, as Trump mentioned that U.S. representatives would arrive in Pakistan for talks on the 20th, indicating that U.S.-Iran negotiations have not completely broken down. Looking ahead, progress in U.S.-Iran peace talks will be a key factor influencing gold’s short-term trend and requires close monitoring.
On the daily chart, gold fluctuated higher last week, with the weekly K-line showing four consecutive positive closes, indicating relatively strong short-term volatility. Support levels for gold include the middle Bollinger Band on the weekly chart at $4,755, which is also near Monday’s gap-down low, followed by the key $4,700 level. Resistance levels include the $4,800 mark; a break above this could target the upper Bollinger Band on the 4-hour chart near $4,860, and then the $4,900 area, which is near last week’s high. The 5-day moving average and MACD indicator show a golden cross trending upward, but the KDJ indicator has formed a death cross, and the RSI indicator’s golden cross is turning downward. Short-term technical signals suggest gold has rebound potential, but upside resistance remains evident.
Intraday gold outlook: Iran’s renewed closure of the Strait of Hormuz has heightened market concerns over negotiation prospects, driving oil and the dollar higher from one-month lows and curbing gold’s rebound. Trading recommendations suggest a range-bound approach, with support monitored at $4,755 and $4,700. A break above the $4,800 resistance level could see further targets at $4,860 and $4,900.