XAU/USD Pulls Back From Two-Week High; Dual Macro Forces Keep Upside Intact

Gold faces mild profit-taking pressure early Monday, easing back from a two-week peak above $4,200 and halting its three-day winning streak. Strait of Hormuz geopolitical tensions revive safe-haven USD demand, capping near-term bullion upside.

The simmering Middle East conflict remains the immediate headline driver. Iran plans to impose new transit fees on vessels passing through the strategic waterway, a measure firmly rejected by the US. The unresolved dispute keeps geopolitical risk premiums anchored in the market, offering tactical support for the US dollar and triggering light selling in gold.

Nevertheless, the greenback’s upside is heavily constrained by dovish Fed repricing. Softer US payroll data and falling crude prices have cooled inflation fears, scaling back market bets for further Fed rate hikes. A less hawkish monetary outlook caps USD bullish momentum, limiting gold’s corrective downside.

Strong structural support continues to underpin gold’s medium-term trend. Global central banks have ramped up gold reserve diversification to hedge geopolitical turmoil, inflation volatility and systemic financial risks. World Gold Council data shows nearly 90% of institutions expect official gold holdings to expand over the coming year.

Traders await US ISM Services PMI and key FOMC member speeches for fresh rate-path cues. The fundamental backdrop remains tilted bullish overall, meaning intraday dips are likely to be well-supported rather than trend-reversing.

XAU/USD Technical Outlook (4-Hour Chart)

Gold retains constructive technical momentum despite near-term consolidation. Prices broke above the 100-period SMA and the 23.6% Fibonacci retracement of the April–June downturn last week, clearing the way for further recovery. Mildly elevated RSI near 63 and positive MACD readings confirm intact upside momentum.

Immediate support sits at the 23.6% Fib level of $4,164, with the key 100-period SMA at $4,259 serving as the primary near-term floor. A decisive breakdown below this zone would invalidate the short-term bullish setup and expose the $3,940 structural low.

On the upside, initial resistance lands at the 38.2% Fib retracement at $4,302. Further hurdles locate at $4,415 (50% Fib), $4,527 (61.8% Fib) and $4,686 (78.6% Fib), with the April swing high of $4,889 marking the major bullish extension target.