Gold Forecast and News
Gold continues scaling higher; tests $4,700 amid peace deal hopes
Gold extends its intraday ascent and climbs to an over one-week high, re-attempting $4,700 on Wednesday. The US Dollar weakens across the board amid optimism over a potential US-Iran peace deal, helping the commodity to build on its recovery from a more than one-month trough, around the $4,500 mark set on Monday.
Latest XAU/USD News
XAU/USD Technical Overview
From a technical perspective, this week's goodish rebound from the $4,500 mark, or the vicinity of the 50% retracement level of the March-April rise, and a subsequent strength beyond the $4,600 round figure favor the XAU/USD bulls. The precious metal is edging closer to the 200-period Simple Moving Average (SMA) at $4,651.69, which now acts as the first hurdle barrier.
Meanwhile, momentum indicators support the topside stance. In fact, the Relative Strength Index (RSI) hovers near 59, indicating firm but not yet overbought conditions. Furthermore, the Moving Average Convergence Divergence (MACD) histogram stays positive and rising, hinting that bullish pressure is rebuilding as the XAU/USD pair challenges overhead supply.
On the downside, initial support is seen at the 38.2% Fibo. retracement at $4,588.83, with deeper pullbacks likely to find demand at the 50.0% retracement near $4,495.62 and then the 61.8% level around $4,402.41 if sellers gain traction. A convincing break below the latter will negate the constructive outlook and shift the near-term bias back in favor of the XAU/USD bears.
Fundamental Overview
US President Donald Trump said on Tuesday that “Project Freedom” – the US military’s operation to guide commercial ships out of the Strait of Hormuz – will be paused for a short period of time to see whether a deal with Iran can be finalized. Trump added in a post on Truth Social that great progress has been made toward a complete and final agreement with representatives of Iran. This follows earlier comments from Defense Secretary Pete Hegseth that the US was not seeking to re-escalate tensions with Iran, and that the US-Iran ceasefire holds for now. Furthermore, Secretary of State Marco Rubio announced that the US-led ‘Operation Epic Fury’ launched against Iran, jointly with Israel, on 28 February, is over.
This raised hopes for a peace deal, which would end the US-Israeli war in Iran and reopen the economically vital strait, boosting investors' confidence and undermining the USD's reserve currency status. Meanwhile, the latest developments dragged crude oil prices to a one-week low, easing fears of surging consumer inflation and paving the way for the US Fed to maintain a cautious stance. However, the CME Group's FedWatch Tool suggests that traders are now pricing in over a 35% probability that the US central bank will hike rates by the end of this year. This might hold back traders from placing aggressive bearish bets around the USD and keep a lid on any further near-term appreciation for the Gold price.
Hence, it will be prudent to wait for strong follow-through buying before confirming that the XAU/USD pair has bottomed out near the $4,500 mark and positioning for further gains. Traders now look to the US ADP report on private-sector employment, due later during the early North American session. Moreover, speeches from influential FOMC members and geopolitical developments will drive the USD demand. The focus, however, will remain glued to the closely-watched US Nonfarm Payrolls (NFP) report on Friday, which will play a key role in determining the near-term trajectory for the buck and the Gold price.
SPECIAL WEEKLY FORECAST
Interested in weekly XAU/USD forecasts? Our experts make weekly updates forecasting the next possible moves of the gold-dollar pair. Here you can find the most recent forecast by our market experts:
Latest XAU/USD Analysis
Editors' picks
EUR/USD retreats to 1.1750 area after upbeat US data
EUR/USD corrects lower after climbing to the 1.1800 area earlier in the day but stays in positive territory near 1.1750. The stronger-than-forecast private sector employment data helps the US Dollar find a foothold, while the risk-on market environment on growing optimism about a US-Iran deal allows the pair to preserve its bullish stance.
GBP/USD scales higher as USD weakens amid renewed US-Iran peace deal hopes
The GBP/USD pair attracts buyers for the second consecutive day on Wednesday and moves away from the weekly low, around the 1.3515-1.3510 area, which was touched the previous day. The optimism over a potential US-Iran peace deal undermines the safe-haven US Dollar and lifts spot prices to the 1.3580 region during the Asian session.
USD/JPY off lows, still down 1% on likely 'Yentervention'
USD/JPY is off ten-week lows but remains heavy near 156.00 in on Wednesday. Markets speculate another round of FX intervention by Japan's authorities behind the latest leg up in the Japanese Yen, keeping the bearish pressure intact on the currency pair. Meanwhile the US Dollar struggles to find demand as markets grow optimistic about the US and Iran finalizing a truce deal.
Gold continues scaling higher; tests $4,700 amid peace deal hopes
Gold extends its intraday ascent and climbs to an over one-week high, re-attempting $4,700 on Wednesday. The US Dollar weakens across the board amid optimism over a potential US-Iran peace deal, helping the commodity to build on its recovery from a more than one-month trough, around the $4,500 mark set on Monday.
WTI Crude Oil tumbles as prospective US–Iran accord eases Strait of Hormuz fears
West Texas Intermediate US Oil falls sharply on Wednesday and trades around $91.00 posting an 8.91% daily decline, as markets rapidly reassess geopolitical risks in the Middle East following reports from Axios suggesting major progress between the United States and Iran.
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Gold (XAU/USD)
In the Forex market, Gold functions as a currency. The particularity of Gold is that it is traded against the United States Dollar (USD), with the internationally accepted code for gold being XAU.
Known as a safe-haven asset, Gold is expected to appreciate in periods of market volatility and economic uncertainty. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.
Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. The United States is the country that holds the biggest resources of Gold in the world.
The XAU/USD pair tells the trader how many US Dollars are needed to purchase one troy ounce of Gold.
The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold prices escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher borrowing costs usually weigh on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars. A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.
ORGANIZATIONS THAT INFLUENCE XAU/USD
- WGC (World Gold Council) is the market development organization for the Gold industry. Its aim is to stimulate and sustain demand for the precious metal.
- LBMA (London Bullion Market Association) is an organization whose members participate in this wholesale over-the-counter market for trading Gold and Silver. It is loosely overseen by the Bank of England. Most LBMA members are major international banks, bullion dealers, and refiners.
- COMEX (Commodity Exchange) is the primary market for trading metals. The COMEX merged with the New York Mercantile Exchange (NYMEX) in 1994 and joined the CME Group in 2008.
- CGSE (Chinese Gold and Silver Exchange Society) is an organization of Gold trading firms in Hong Kong that are participants of the Chinese Gold and Silver Exchange, the first exchange in Hong Kong.
- Central banks like the Federal Reserve (Fed), the European Central Bank (ECB) or the People's Bank of China (PBoC) significantly influence Gold prices through their monetary policies.
PEOPLE THAT INFLUENCE XAU/USD
- Neal Froneman, the World Gold Council’s Chairman.
- Scott Bessent, the US Treasury Secretary.
- Xi Jinping, President of the People's Republic of China.
- The London Bullion Market Association members.
CIRCUMSTANCES THAT INFLUENCE XAU/USD
The main variables traders should monitor to understand Gold’s position are:
- Demand and supply: The balance between global Gold demand and its availability impacts its price.
- Economic uncertainty and currency devaluation: Gold is widely known as a safe-haven asset for investors in periods of economic uncertainty or when a currency faces devaluation.
- Practical applications: The use of Gold in technology innovations, jewelry manufacturing and other industrial applications.
ASSETS THAT INFLUENCE XAU/USD
- Currencies: The US Dollar (USD) and the Euro (EUR) are the primary currencies influencing Gold prices. Other important currency pairs include EUR/USD, GBP/USD, USD/JPY, AUD/USD, USD/CHF, NZD/USD, and USD/CAD.
- Commodities: Silver and Gold are the most important precious metal commodities.
- Bonds: Influential fixed-income securities include the German Bund (a federal government-issued bond) and the US Treasury Note (T-Note).
- Indices: Key indices related to Gold and mining include the HUI (NYSE Arca Gold BUGS), the XAU (Philadelphia Gold and Silver Index) and the GDM (NYSE Arca Gold Miners Index).
- Exchanges: The most important stock exchanges for Gold are the New York Mercantile Exchange (COMEX), the Chicago Board of Trade, the Euronext/LIFFE, the London Bullion Market, the Tokyo Commodity Exchange, the Bolsa der Mercadorias e Futuros and the Korea Futures Exchange.