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Today Gold Market Analysis

As of now, spot gold prices are trading around $4,695 per ounce. Today, the market showed narrow fluctuations, with prices moving between $4,684 and $4,722, indicating that after digesting yesterday's large gains, both bulls and bears have temporarily reached a balance.

Core Driving Factors

‌Geopolitical easing expectations dominate the market‌

The core driver behind the nearly 3% surge in gold prices yesterday is optimistic expectations that the US and Iran may reach a peace agreement. The market bets that the end of this geopolitical conflict will bring three major benefits:

‌Oil prices plummet‌: Brent crude oil once plunged nearly 11%, falling below the $100 mark, significantly easing inflation concerns.

‌Dollar weakens‌: The dollar index declined, making gold priced in dollars more attractive to holders of other currencies.

‌US Treasury yields fall‌: The 10-year US Treasury yield declined, reducing the opportunity cost of holding non-yielding assets like gold.

‌Market focus shifts to economic data‌

Following signs of easing geopolitical tensions, market attention quickly shifted to macroeconomic fundamentals. The upcoming release of the‌ US Non-Farm Payrolls‌ report tomorrow has become the focus, as it will test the resilience of the US economy and reshape market expectations for the Federal Reserve's future monetary policy. Weak data could reignite expectations of rate cuts, benefiting gold; conversely, strong data might suppress gold prices.

Key Support and Resistance Levels

From a technical perspective, after yesterday's sharp rise, gold is facing a test of key resistance levels, with solid support below.

‌Key Resistance Levels‌

‌$4,700 - $4,722‌: This is the high point area for today’s trading and a direct short-term resistance level. A successful breakthrough would further boost bullish confidence.

‌$4,800‌: This is an important previous technical threshold and a resistance level mentioned by many institutions. Breaking above this level would mean the bottom structure of this correction is more solid.

‌Key Support Levels‌

‌$4,650‌: This is the lower boundary of today’s trading range and the primary defense line for short-term bulls.

‌$4,600‌: This is a more critical psychological and structural support. If prices pull back to this level and stabilize, it can be seen as a healthy correction.

‌$4,500‌: Many analysis institutions consider this a solid bottom area for this correction and an important cost zone for central bank gold purchases and long-term allocations.

Market Outlook

Currently, the gold market is in a state of “short-term gains realization” intertwined with “long-term fundamentals stability.”

‌In the short term‌, the trend will heavily depend on substantive progress in the US-Iran peace agreement and the upcoming US non-farm payroll data. If the positive atmosphere of peace negotiations persists and economic data fails to provide clear guidance, gold prices may remain within the range of‌ $4,600 to $4,800‌, using time to gain space and digest previous gains. It is not advisable to chase high blindly; instead, focus on opportunities after pullbacks and stabilization.

‌In the medium to long term‌, the structural factors supporting gold strength remain unchanged. Central banks worldwide continue to buy gold (the Chinese central bank has increased holdings for 18 consecutive months), the high US fiscal deficit erodes dollar confidence over the long term, and gold’s strategic value as a hedge against geopolitical and sovereign credit risks all provide solid support for gold prices. Many institutions (such as JPMorgan and Goldman Sachs) still maintain forecasts of gold reaching‌ $5,000 or even higher by the end of the year.

However, downward risks should be noted: if the new Fed Chair Kevin Wirth makes hawkish comments or geopolitical tensions worsen (such as issues with Iran), markets could see a correction.