Gold extends recovery as improving geopolitical outlook weighs on the dollar
Gold remained in positive territory for the fourth straight session, climbing in early Tuesday trading to its highest level since March 19, extending Monday’s strong rally when prices surged nearly 3.5% — the biggest daily gain since February 6.
Monday’s decisive break and close above the key $4600 resistance zone (38.2% Fibonacci retracement of the $5419/$4099 decline and the 100DMA) generated a solid signal for continuation of the recovery from the March 23 low at $4099, following a week of consolidation within the $4600/$4305 range.
Improved geopolitical sentiment, after President Donald Trump signaled that the Middle East conflict could end within 2–3 weeks, helped revive risk appetite. This pressured the dollar and supported renewed demand for gold.
Near-term direction will largely depend on the durability of this positive sentiment, as similar statements in the past have often proved short-lived and insufficient to sustain broader market optimism. However, expectations of a potential resolution to the conflict could continue to underpin prices.
Immediate resistance stands at $4759 (50% retracement / daily Kijun-sen), followed by $4800 (falling 20DMA) and the $4915/21/35 zone (61.8% Fibonacci retracement / 55DMA / base of the daily cloud).
The daily technical picture has improved, supported by a break above the 100DMA and a 5/10DMA bullish crossover. However, further confirmation is still needed, as the 14-day momentum remains in negative territory, RSI is moving into neutral levels, and stochastic indicators are in overbought conditions.
This leaves room for a potential corrective phase before the broader downtrend from the $5419 peak resumes, particularly if fundamental support weakens.
A sustained break above $4759 would strengthen bullish momentum and improve the near-term outlook, while a drop back below the 100DMA at $4642 would risk a retest of the $4600 level — now acting as strong support — with a break below it likely to sideline near-term bulls.
Res: 4759; 4800; 4841; 4900
Sup: 4661; 4642; 4600; 4532
