Near $4,110: XAU/USD Reaches Lows as Yields and Oil Rise | Gold Price Forecast

$4,100 comes into view for Gold. Losses extend into a fourth consecutive day.
Higher US yields and oil prices underpin a US Dollar recovery.
Around $4,070, the monthly range floor is the focus for bears.

$4,100 is drawing closer for Gold (XAU/USD). Wednesday marks a fourth consecutive day of losses as a modest rise in US Treasury yields and higher oil prices help the US Dollar (USD) recover slightly from Tuesday’s lows. During Asian and European trading, the precious metal has consolidated just above $4,100, bringing the key support zone around $4,070 increasingly into focus.

TMGM Analysis: Financial Market News, Economic Calendar & Market Insights

Brent Oil has gained 1.6% so far on the day. Higher oil prices continue to restrain risk appetite and weigh on demand for precious metals. A US-Iran peace agreement remains out of reach as the conflict enters its eighth month, with no end in sight.

Hopes for another round of US-Iran negotiations rose after Pakistan’s army chief Asim Munir arrived in Tehran on Tuesday. The talks broke down, however, over Iran’s refusal to send enriched nuclear material abroad. Earlier, on Monday, US Secretary of State Marco Rubio said securing a peace agreement with Iran was extremely difficult and affirmed that the US would keep economic pressure on the Islamic Republic.

Speaking to Iranian media, Iranian Foreign Minister Abbas Araghchi said the Strait of Hormuz would stay closed until Washington agreed to Iran’s conditions.

$4,070 Range Floor Nears: Technical Analysis

Following a reversal of nearly 1.3% over the last three trading days, XAU/USD remains constrained just below $4,120. Momentum readings reinforce the bearish bias. The 4-hour Relative Strength Index (14) sits in neutral-to-soft territory, while the MACD (12, 26, 9) remains below zero. Together, they indicate that recovery attempts remain vulnerable.

For now, selling pressure is contained above the $4,100 area, the intraday lows. October’s trading range floor around $4,070 is in view. A break below that level is likely to require fresh impetus before sellers can target the late July and early August lows near the psychological $4,000 area.

Any rebound, by contrast, is likely to encounter resistance in the $4,190- $4,200 zone, which has repeatedly limited gains over the past few days. Beyond that, the upper boundary of October’s range sits around $4,230.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

Gold: Key Questions

Gold Investment: What Attracts Investors?

Throughout human history, Gold has served extensively as both a store of value and a means of exchange, giving it an important role. Today, its appeal extends beyond its lustre and use in jewellery. The precious metal is widely regarded as a safe-haven asset, or an attractive investment during periods of turmoil. With no dependence on a particular issuer or government, Gold is also commonly used as a hedge against inflation and currency depreciation.

Gold Buyers: Who Leads the Market?

The largest holders of Gold are central banks. To support their currencies during turbulent periods, they typically diversify reserves and purchase Gold, bolstering perceptions of economic and currency strength. Substantial Gold reserves can strengthen confidence in a country’s solvency. According to the World Gold Council, central banks increased their reserves by 1,136 tonnes of Gold, valued at around $70 billion, in 2022. No higher annual purchase has been recorded since records began. Emerging-economy central banks, including those in China, India and Turkey, are expanding their Gold reserves rapidly.

Gold and Other Assets: How Do They Correlate?

Both the US Dollar and US Treasuries are major reserve and safe-haven assets, and Gold is inversely correlated with them. A weaker Dollar typically supports Gold, allowing investors and central banks to diversify their holdings during unsettled periods. Risk assets also tend to move in the opposite direction to Gold. Stock market gains generally put pressure on the metal’s price, whereas selling in riskier markets usually supports it.

Gold Prices: What Drives Their Moves?

A broad set of influences can shift Gold prices. Its safe-haven appeal means geopolitical instability or concerns over a deep recession can trigger rapid gains. Because Gold pays no yield, lower interest rates generally support it, while higher borrowing costs usually weigh on the metal. Most price movements nevertheless hinge on the US Dollar (USD), since Gold is denominated in dollars (XAU/USD). Dollar strength tends to restrain Gold prices; a weaker Dollar, in contrast, is likely to lift them.