Gold Faces Pressure

Gold Prices Lack Strong Bullish Conviction Near $4,200 as Fed Rate Hike Bets and Iran Risks Support US Dollar

Gold prices maintained a modest bid tone near the $4,200 level during the first half of the European session, appearing to snap a three-day losing streak after touching their lowest level in more than a week on the previous day.

The precious metal found some support as crude oil prices reversed lower after mediators from Qatar and Pakistan announced an official 60-day roadmap aimed at securing a final peace agreement between the United States and Iran.

XAU/USD Technical Analysis

From a technical perspective, last week's failed attempt to break above the 200-day Exponential Moving Average (EMA), which has now turned into a key resistance level, continues to favor bearish traders. The subsequent decline reinforces downside pressure on the XAU/USD pair.

Meanwhile, the Relative Strength Index (RSI) remains in the upper-30 range, signaling limited buying momentum. In addition, the Moving Average Convergence Divergence (MACD) indicator remains in negative territory with slightly negative histogram readings, suggesting that bearish momentum is easing but has yet to reverse.

The 200-day EMA near $4,334 now serves as the first major resistance level that bulls must reclaim to reduce the current bearish pressure. Until gold secures a daily close above this level, any recovery is likely to be viewed as a corrective rebound within a broader consolidation phase.

Momentum indicators continue to suggest that further downside tests cannot be ruled out in the near term.

Fundamental Overview

Market participants are currently pricing in nearly a 90% probability that the US Federal Reserve will raise interest rates before the end of the year.

These expectations strengthened after the Fed's hawkish projections last week indicated policymakers may need to tighten monetary policy further if inflation remains stubbornly elevated.

Adding to the outlook, newly appointed Federal Reserve Chair Kevin Warsh emphasized the importance of price stability during his post-meeting press conference, signaling that the central bank may be reluctant to cut interest rates even if economic growth slows.

At the same time, geopolitical developments over the weekend provided additional support for the US Dollar, limiting the upside potential for gold.

Iran accused the United States and Israel of violating the ceasefire agreement and announced the renewed closure of the Strait of Hormuz, citing continued Israeli military operations in Lebanon. Furthermore, US President Donald Trump threatened additional military action against Iran if Hezbollah continues attacks against Israel.

These developments highlight the fragile nature of the diplomatic process and keep geopolitical risk premiums elevated across global markets.

Meanwhile, Russia has intensified attacks on major Ukrainian cities in recent weeks, helping the safe-haven US Dollar hold near its strongest levels since May 2025. This has further capped gains in gold prices and warrants caution among bullish traders.

Market Outlook

Looking ahead, investor attention will remain focused on developments surrounding US-Iran negotiations, which are likely to continue driving volatility across global financial markets.

Comments from influential Federal Open Market Committee (FOMC) members will also be closely monitored for additional clues regarding the Federal Reserve's policy path, potentially influencing demand for the US Dollar and precious metals.

However, the prevailing fundamental backdrop suggests that any recovery attempts in gold may continue to attract selling interest and could struggle to gain sustained momentum.

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Gold Under Pressure

Gold Heads for Third Straight Weekly Loss as Hawkish Fed Outweighs Iran Ceasefire Optimism

Gold Prices Extend Decline Amid Stronger US Dollar and Hawkish Federal Reserve Outlook

Gold prices continued to slide during Asian trading on Friday and remained on track for a third consecutive weekly loss, as a stronger U.S. dollar and the Federal Reserve’s hawkish policy outlook overshadowed support from a temporary peace agreement between Washington and Tehran.

Spot gold fell 1.8% to $4,134.86 per ounce as of 09:40 WIB, while U.S. gold futures for August delivery declined 2.2% to $4,152.25 per ounce.

The precious metal is now heading for a weekly decline of approximately 2%. Gold initially surged earlier in the week on optimism surrounding the U.S.-Iran peace deal, but sentiment weakened significantly following the Federal Reserve’s latest policy meeting.

Federal Reserve Signals Higher Rates for Longer

Market pressure intensified after nine of the Federal Reserve’s 19 policymakers projected at least one additional interest rate hike before the end of the year. The outlook reinforced expectations that borrowing costs could remain elevated for an extended period.

Although the Fed left interest rates unchanged on Wednesday, comments from Chair Kevin Warsh were widely interpreted as strongly hawkish. The remarks pushed U.S. Treasury yields higher and lifted the U.S. dollar to its strongest level in more than a year.

The U.S. Dollar Index remained largely unchanged during Asian trading after surging 0.8% on Thursday, reaching its highest level since May 2025.

A stronger dollar makes dollar-denominated gold more expensive for overseas buyers, while higher interest rates increase the opportunity cost of holding non-yielding assets such as gold.

According to futures market pricing, investors now see more than an 80% probability of a Federal Reserve rate hike before year-end.

Middle East Peace Talks Uncertainty Adds Pressure to Gold Market

Gold’s weakness was further amplified after Switzerland announced that negotiations for a final agreement to end the Middle East conflict would not take place on Friday as previously anticipated.

Reports indicated that U.S. Vice President J.D. Vance suspended plans for talks in Geneva, raising concerns about the durability of the recently announced temporary agreement.

The ceasefire arrangement had been expected to facilitate the reopening of key shipping routes through the Strait of Hormuz and contributed to a sharp decline in oil prices earlier this week.

However, crude oil prices rebounded on Friday, reigniting inflation concerns and adding another layer of uncertainty for financial markets.

Silver, Platinum, and Copper Prices Also Move Lower

Other precious metals also posted notable losses. Silver prices dropped 2.5% to $64.09 per ounce, while platinum declined 1.4% to $1,674.51 per ounce.

In the industrial metals market, benchmark copper futures on the London Metal Exchange fell 0.9% to $13,582.33 per metric ton. U.S. copper futures also weakened, slipping 1% to $6.30 per pound.

Outlook for Gold

Gold remains vulnerable to further downside pressure as investors reassess expectations for U.S. monetary policy and monitor developments surrounding Middle East peace negotiations. With the Federal Reserve maintaining a hawkish stance and the U.S. dollar trading near multi-year highs, the precious metal may continue to face headwinds despite ongoing geopolitical uncertainties.

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Gold Prices Rebound

Gold Prices Rebound as Markets Assess US-Iran Peace Deal and Federal Reserve Rate Outlook

Gold prices edged higher on Thursday, recovering from losses recorded in the previous session as investors weighed the impact of a temporary US-Iran peace agreement against the Federal Reserve’s signals of potential interest rate hikes later this year.

Spot gold rose 0.3% to $4,269.42 per ounce as of 16:46 GMT, while gold futures slipped 2.1% to $4,288.72 per ounce.

The precious metal had fallen 1.7% in the prior session after a stronger US dollar and rising Treasury yields followed the Federal Reserve’s latest monetary policy decision.

Bullion prices found support from growing optimism surrounding the US-Iran agreement, which is expected to ease geopolitical tensions in the Middle East and pave the way for the reopening of critical energy export routes.

The 14-point memorandum initiates a 60-day negotiation period during which Iran will allow toll-free navigation through the Strait of Hormuz. Under the agreement, traffic through the strategic waterway is expected to return to full capacity within 30 days.

The development has helped reduce concerns over prolonged oil supply disruptions, easing fears of energy-driven inflation while supporting demand for gold as a portfolio hedge against market uncertainty.

However, gains in gold prices remained limited after the Federal Reserve left interest rates unchanged at 3.50%–3.75% on Wednesday and indicated that policymakers still see room for additional monetary tightening later this year.

Updated projections revealed that nine of the 19 Federal Reserve officials expect at least one interest rate increase in 2026, marking a notable shift from expectations seen earlier this year.

XAU/USD Outlook

In his first meeting as Federal Reserve Chair, Kevin Warsh maintained a hawkish stance on inflation, emphasizing the central bank’s commitment to restoring price stability.

The Fed also raised its inflation forecasts, prompting investors to scale back expectations for future rate cuts and boosting the US dollar.

A stronger dollar typically makes dollar-denominated gold more expensive for overseas buyers, while higher interest rates increase the opportunity cost of holding non-yielding assets such as gold bullion.

As investors continue to monitor monetary policy developments and geopolitical events, gold prices are expected to remain sensitive to changes in inflation expectations, interest rate projections, and global risk sentiment.

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