Gold Follows Global Market Relief Rally, Focus on Iran War
Gold extended its rebound from near $5,000 early Tuesday as global risk sentiment improved across financial markets. The US Dollar (USD) consolidated its overnight losses after comments from US President Donald Trump suggested that the war involving Iran could “soon be over.”
From a technical perspective, gold needs a daily close above the 61.8% Fibonacci level at $5,141 to confirm further upside momentum.
Gold Technical Outlook Remains Slightly Bullish
The short-term bias for gold remains slightly bullish as prices continue to hold above the rising 21-day and 50-day Simple Moving Averages (SMA). Meanwhile, the 100-day and 200-day SMAs are also trending higher well below current market levels, reinforcing the broader uptrend.
The Relative Strength Index (RSI) currently sits near 55, staying above the neutral 50 level. This indicates positive momentum without being overbought, suggesting the market is still digesting its recent gains.
Gold recently rebounded from the 38.2% Fibonacci retracement level at $4,858.82, measured from the $4,401.99 low to the $5,597.89 high, supporting the view that buyers remain active during pullbacks within the broader bullish trend.
Key Support and Resistance Levels
The nearest support level is located at the 50% Fibonacci retracement near $4,999.94, followed by the 38.2% retracement at $4,858.82, where previous demand aligns with a cluster of intermediate moving averages.
A break below this area could expose the next downside target toward the 23.6% retracement at $4,684.22.
On the upside, initial resistance is seen near the recent high around $5,263.55, followed by the 61.8% Fibonacci level at $5,141.05, which now acts as an important reference within the current trading range. The next major resistance lies at the swing high of $5,597.89.
A daily close above $5,263.55 would likely open the door for a retest of $5,597.89, while a move below $4,999.94 could weaken the current bullish bias and shift gold into a broader consolidation phase.
Market Relief Rally Supports Gold Prices
Gold buyers returned to the market as investors reacted to a relief rally across global financial markets. The rally emerged after oil prices cooled and traders began anticipating a possible end to the Middle East conflict.
Optimism increased after Donald Trump told CBS News on Monday:
“I think the war is very complete, almost finished. They have no navy, no communication, and no air force.”
Earlier Tuesday, The Wall Street Journal (WSJ) reported that Trump’s advisers had privately urged him to seek an exit strategy, amid rising oil prices and concerns that a prolonged conflict could trigger political backlash. This reportedly pushed the US president to publicly signal that the military campaign in Iran could soon end.
Additional relief came after reports suggested that Washington may soften sanctions on Russian energy, which contributed to a sharp reversal in oil prices after they had surged 25% to a three-year high.