Gold (XAU/USD) stayed under pressure during the Asian trading session trading near the $4,470 level after touching its lowest point since March 30 earlier on Wednesday. A powerful US Dollar continues to weigh on Gold prices as investors remain careful about the ongoing US-Iran status and the outlook for US interest rates.
Market sentiment remains volatile over the potential of a US Iran agreement. US President Donald Trump stated on Tuesday that military action against Iran could still be considered if negotiations fail noting that an attack had nearly been approved before being delayed following appeals from Gulf leaders. At the same time Vice President JD Vance said talks between the two countries have progressed and both sides are trying to avoid renewed conflict.
Despite these comments concerns remain over unresolved issues surrounding Iran nuclear program and the Strait of Hormuz. This uncertainty has supported demand for the US Dollar as a safe-haven asset creating pressure on Gold prices.
Meanwhile tensions in the Middle East have kept Crude Oil prices close to monthly highs adding to inflation concerns. Rising inflation expectations have strengthened market bets that the US Federal Reserve could maintain a stricter policy stance. According to market expectations traders are increasingly pricing in the possibility of a US rate increase in 2026.
Comments from Philadelphia Fed officials also reinforced this outlook suggesting that higher rates may still be needed if economic growth remains strong or inflation risks rise. As a result US Treasury yields have moved higher further supporting the Dollar and limiting demand for non-yielding assets like Gold.
However traders remain cautious ahead of the release of the FOMC Minutes later in the North American session, which may offer fresh guidance on the Fedโs future policy direction. Developments in the Middle East will also remain a key driver for Gold.
Gold Technical Outlook
From a technical viewpoint Gold faces continued downside pressure after slipping below the important $4,500 psychological level. Momentum indicators remain weak with the RSI near the mid 30 ranges and MACD staying in negative habitat indicating fading buying strength.
Even so Gold still finds long term support near the 200-day simple Moving Average (SMA) located around $4,363. A clear disrupt below this support could trigger deeper losses while holding above it may allow prices to stabilize and maintain the broader long term upturn despite current weakness.
