The US dollar remains volatile at high levels, and gold has been under pressure for three consecutive days, fluctuating weakly.

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Source: Huìtōng Finance

On Tuesday during European hours, spot gold continued its decline, remaining within the previous trading day’s range, showing a three-day streak of weakness overall. Although the downward move lacked significant volume, market sentiment remained generally bearish.

From a macro perspective, the strengthening of the US dollar is the main factor suppressing gold at present. As uncertainties in the Middle East escalate, the dollar, as a safe-haven asset, is attracting capital inflows, reinforcing its status as a global reserve currency. Meanwhile, US economic data shows resilience, especially the strong non-farm payroll figures previously released, which further reinforce market expectations that the Federal Reserve will maintain high interest rates, exerting ongoing pressure on gold.

At the same time, rising inflation expectations have become a key variable. Due to increases in energy prices, the market generally anticipates inflationary pressures to re-emerge. According to data from the US Institute of Supply Management, the services PMI rose to 70.7, significantly higher than the previous value, indicating rising cost pressures. This further strengthens market expectations that interest rates will stay higher longer, reducing gold’s appeal as a non-yielding asset.

On the geopolitical front, tensions around the Strait of Hormuz continue to ferment. US President Donald Trump set a deadline, demanding relevant parties restore passage; otherwise, he will take strong measures. Although concerns about escalating conflict remain, safe-haven funds are flowing more into the dollar rather than gold, limiting the support for gold prices.

Additionally, rising oil prices also indirectly pressure gold. The increase in energy prices not only raises inflation expectations but also reinforces the likelihood of central banks maintaining tightening policies, making it difficult for gold to sustain buying interest.

From a technical perspective, on the daily chart, gold is generally in a correction phase, with multiple rebounds blocked at previous resistance zones, indicating clear selling pressure above. The short-term trend has shifted from strong to weak, showing a oscillating and bearish structure. If prices continue to stay below key resistance, a mid-term correction is likely to persist.

On the 4-hour chart, gold is moving within a downward structure, with prices consistently pressured below the 200-period moving average, forming a clear trend suppression. The current price is below this moving average, confirming a short-term bearish pattern. The MACD indicator is below zero, with the histogram maintaining negative values, indicating that bearish momentum remains but has not significantly expanded; RSI is around 49, in a neutral to weak zone, suggesting the market is in a consolidating downtrend. Regarding key levels, initial resistance is around $4,600, corresponding to the 38.2% Fibonacci retracement level. A break above could target further gains toward $4,760 (50% retracement). However, until this zone and the 200-period moving average are broken, rebounds may be viewed as opportunities to short on rallies. Support is near $4,600; a break below could target $4,400 as the next phase goal.

Editor’s Summary:

The core logic of the current gold market is “Dollar strength + high interest rate expectations.” Although geopolitical tensions persist, support for gold is weaker than before, with funds flowing more into dollar assets. Rising inflation pressures and expectations of tightening monetary policy put gold under pressure. In the short term, before key resistance is broken, gold remains in a correction phase, likely maintaining a oscillating and weak pattern, with risks of further downside to watch out for.