FX.co ★ HiDe_N_SeEk | XAU/USD, GOLD

Gold For the second day in a row, gold (XAU/USD) shows some follow-through positive traction on Wednesday and continues to rise from a bottom of more than a month, which was reached at the beginning of this week at almost $4,500. Amidst the euphoria surrounding a possible peace deal between the US and Iran, the US dollar (USD) declines overall, supporting the commodity. Additionally, declining crude oil prices allay worries about inflation and reduce expectations of a more aggressive US Federal Reserve (Fed), which is thought to be another advantage for the unyielding yellow metal. The US military's effort to direct commercial ships out of the Strait of Hormuz, known as "Project Freedom," will be temporarily halted in order to see if a deal with Iran can be reached, US President Donald Trump announced on Tuesday. Significant work has been made toward a comprehensive and final agreement with Iranian authorities, Trump noted in a post on Truth Social. This comes after Defense Secretary Pete Hegseth stated yesterday that the US-Iran ceasefire is in place for the time being and that the US was not looking to raise tensions with Iran. Additionally, Secretary of State Marco Rubio declared the end of the US-led "Operation Epic Fury," which was initiated against Iran on February 28 in collaboration with Israel. Technically speaking, the XAU/USD bulls are favored by this week's positive rebound from the $4,500 mark, or the area of the 50% retracement level of the March-April climb, and a following strength beyond the $4,600 round figure. At $4,651.69, the precious metal is getting closer to the 200-period Simple Moving Average (SMA), which now serves as the first obstacle. In the meantime, the topside position is supported by momentum indicators. In actuality, the Relative Strength Index (RSI) is close to 59, indicating conditions that are firm but not yet overbought. Additionally, as the XAU/USD pair battles overhead supply, the Moving Average Convergence Divergence (MACD) histogram continues to rise and remain positive, suggesting that bullish pressure is strengthening. If sellers gain momentum, deeper pullbacks are anticipated to find demand around the 50.0% retracement near $4,495.62 and later the 61.8% level around $4,402.41. On the downside, initial support is indicated at the 38.2% Fibonacci retracement at $4,588.83. The positive outlook will be negated, and the near-term bias will return to favoring the XAU/USD bearish if there is a strong breach below the latter.

Gold On Wednesday, gold reversed course and surged to a seven-day high of $4,723, regaining the 10-day moving average. A solid closing in the higher third of the day's range will validate the strength of the one-day move, but resistance was observed close to the 20-day moving average. This might result in a continuation towards the next resistance zone, which is now between $4,774 and $4,790 and is located close to the 50-day and 100-day moving averages. The 10-day moving average serves as support for short-term gold, while the 20-day moving average serves as resistance. Signs of resistance are expected due to the long-term relevance of the combination of the two averages, indicating a similar resistance zone. Furthermore, the upper boundary line of a sizable rising trend channel indicates that they are near a resistance zone. Recently, gold broke free from a rising bearish wedge, finishing its first leg down at $4,501 on Monday. That created a higher swing low, but the wedge trigger indicates that a rally is under downward pressure. The bottom end of a zone is the 200-day moving average around $4,301, while more important lower objectives begin at about $4,402. After the wedge trigger, a counterrally would be typical and anticipated. It offers the opportunity to construct a lower swing high and another leg down toward lower targets. Until the 50-day moving average is recovered and the price stays above it, this bearish situation is still in effect. The 100-day average must have been recovered if the 50-day average was. The trend indication was confirmed since the 50-day average was hit as resistance during the lower swing high of $4,890 (top of wedge).