Gold Struggles Near Daily Low as US Dollar Strengthens on Fed Bets

Gold prices stayed under pressure during the first half of the European trading session on Tuesday staying below the key $4,580 resistance level after failing to hold earlier gains. A stronger US Dollar supported by rising geopolitical tensions and growing expectations of a hawkish stance from the US Federal Reserve (Fed) continued to weigh on the precious metal.

Uncertainty surrounding a possible US-Iran peace agreement limited market optimism and boosted demand for the safe-haven USD. At the same time renewed geopolitical tensions supported a modest rebound in crude oil prices increasing concerns over inflation and strengthening expectations that the Fed could maintain tighter monetary policy. This mix reduced demand for non-yielding assets such as Gold.

Reports citing US Central Command stated that American forces carried out self-defense strikes in southern Iran on Monday targeting missile launch sites and Iranian boats allegedly attempting to deploy naval mines. These developments add to ongoing disputes over Iran’s nuclear program and rising tensions around the Strait of Hormuz, weakening hopes for a resolution to the nearly three-month-long conflict. US President Donald Trump has also warned of further military action if Iran refuses broader peace negotiations, keeping geopolitical risks elevated and supporting the US Dollar.

Iran’s disruption of shipping traffic through the Gulf has further intensified market concerns, affecting nearly 20% of global oil supplies. Combined with US restrictions on Iranian ports, these developments pushed crude oil prices higher after recently touching a two-week low. Rising energy costs have renewed fears of inflation, prompting expectations that major central banks, including the Fed, could maintain a more aggressive policy stance. According to CME Fed Watch projections, traders are increasingly considering the possibility of at least one US interest rate hike in 2026, further supporting the USD and pressuring Gold prices.

Investors are now turning their attention toward key US economic releases scheduled for Thursday, including the Personal Consumption Expenditures (PCE) Price Index and revised GDP figures. These reports are expected to influence USD demand and determine the next direction for Gold prices. In the short term, markets will also monitor the Conference Board’s US Consumer Sentiment Index and continue tracking developments in the Middle East, which may keep financial markets volatile. For now, broader market fundamentals suggest that Gold remains vulnerable to further downside movement.

Technical Outlook

From a technical perspective, Gold faced strong resistance near the $4,580 level and continues to trade below the 100-period Exponential Moving Average (EMA) on the four-hour chart, maintaining a mildly bearish outlook. Although the MACD indicator remains in positive territory, momentum appears limited, while the Relative Strength Index (RSI) near 47 reflects neutral market conditions and a lack of strong buying pressure.

The $4,580 zone remains the first major resistance level, followed by the 100-period EMA near $4,593.73. A sustained breakout above these barriers would be required to weaken the current bearish sentiment and support a stronger recovery. On the downside, traders are closely watching support levels around $4,490-$4,485, followed by the $4,450 area, which may act as the next important demand zones if selling pressure continues.