Gold Holds Firm as Middle East Tensions Continue to Subside

Gold opened the week on a strong note, gapping higher on Monday and gaining around 1.5% during Asian trading.

The metal drew support from a softer geopolitical backdrop after the United States and Iran paused hostilities, raising hopes for renewed diplomatic engagement. The reduced risk environment helped ease inflation concerns and lowered expectations for additional Federal Reserve rate hikes in the coming months.

As a result, the U.S. dollar came under pressure, providing fresh support for gold. The precious metal reclaimed the $4,100 level after finding solid footing above the key $4,000 support zone during the recent pullback.

Gold is now trading near the upper end of its short-term $3,950–$4,200 range, improving the near-term outlook. While the daily technical picture remains fragile, it continues to strengthen. Sustained trading above the 20-day moving average at $4,072 would help maintain a mildly bullish bias, supported by the 14-day momentum indicator, which is approaching positive territory.

Under these conditions, the $4,200 resistance level remains in focus. A decisive break above this barrier would provide an initial signal of a trend reversal and confirm the formation of a short-term base.

Further upside will depend on supportive fundamentals remaining in place or improving further to sustain the current positive momentum.

On the downside, initial support is located at the 20-day moving average of $4,072, followed by the 10-day moving average at $4,052. A break below these levels could weaken bullish sentiment and increase the risk of a retest of the range floor.

Res: 4116; 4166; 4182; 4203
Sup: 4072; 4052; 4021; 4000