Gold Holds Recovery Above $4,700 as Focus Shifts to US NFP Data
Gold maintained its recovery momentum above the $4,700 level during the European session on Friday. Despite renewed tensions in the Strait of Hormuz, investors remained optimistic about the possibility of a US-Iran peace agreement. This optimism triggered another decline in Crude Oil prices, easing inflation concerns and reducing expectations of a more hawkish stance from the US Federal Reserve. As a result, the US Dollar’s upside remained limited, providing key support for bullion prices.
The XAU/USD pair continues to show a strong bullish bias as it trades above the 200-period Simple Moving Average (SMA) and stays above the 61.8% Fibonacci retracement level of the latest upward move. In addition, momentum indicators remain supportive of further gains. The Relative Strength Index (RSI) stands at 64.24, remaining in positive territory without entering deeply overbought conditions, while the Moving Average Convergence Divergence (MACD) (12, 26, 9) posts a positive reading near 6.13. This suggests bullish momentum is still intact, although less aggressive compared to the previous rally phase.
On the downside, the 23.6% Fibonacci retracement level at $4,703.51 has turned into immediate support, followed by the 200-period SMA at $4,665.16. Deeper support levels are seen at $4,587.31 (38.2%) and $4,493.39 (50.0%) should a broader correction occur. On the upside, the next significant resistance stands near the swing anchor at $4,891.35. As long as Gold prices remain above the $4,700 area, any pullback is likely to be viewed as corrective within the ongoing uptrend.