TradingKey - In early Asian trading today (March 23), international spot gold ( XAUUSD) prices saw sharp volatility, quickly breaking below the key $4,400 per ounce support level after the open and hitting a low of $4,319, as the decline widened to as much as 3.8% at one point. This marks the first time since February that gold has lost this technical level, with market selling pressure intensifying significantly.

Analysis suggests that this dive in gold prices is due to a combination of factors. On one hand, the latest Fed meeting minutes showed that some officials expressed concern about an inflation rebound, hinting at a possible extension of high interest rates. The U.S. Dollar Index subsequently rebounded, climbing above the 100.00 mark and exerting direct pressure on non-yielding gold. On the other hand, the earlier geopolitical risk premium has gradually faded, and with signs of easing in the transit through the Strait of Hormuz, safe-haven capital has accelerated its exit.

From a technical perspective, $4,400 has been a critical support level for gold over the past three months. If today's closing price is below $4,400, this breakdown could break gold's overall upward trend and trigger a deeper decline; conversely, if the closing price is above $4,400, this breach will be seen as a false breakdown, and gold's overall uptrend could be sustained.

Analysts pointed out that if gold prices fail to stabilize above $4,400, the next support level could shift down toward $4,270.

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