Spot Gold (XAU/USD) opened the week with a marginal gap lower, struggling to maintain the $4,600 support level during early Asian trading. This decline comes amid heightened risk-off sentiment in financial markets following United States President Donald Trump's statement on Tuesday, threatening to destroy Iran if the country does not reopen the Strait of Hormuz by Friday. Trump specifically warned of targeting Iran's power plants and bridges should Tehran refuse to comply after a ten-day truce. In response, Iran announced reciprocal attacks on US or related infrastructure, signaling a potential escalation in the ongoing Middle East conflict [1].
The market environment is further complicated by the closure of multiple Asian and European markets due to the Easter Monday Holiday, with investors expected to return in full force during the American session. Meanwhile, West Texas Intermediate (WTI) crude oil is trading around $106 per barrel, marking its highest level in over a month [1].
From a technical perspective, the near-term outlook for XAU/USD is bearish. The 4-hour chart shows gold slipping below the rising 20-period Simple Moving Average (SMA) near $4,663, and remaining well under the declining 100- and 200-period SMAs at $4,700 and $4,900, respectively. Momentum indicators have turned negative, with the Relative Strength Index (RSI) retreating toward the 50 line from previously overbought territory, suggesting buyers have lost control and the market is entering a corrective phase. Immediate support is identified at $4,600, with further downside risk to $4,560 if selling pressure persists. Resistance levels are noted at $4,663, $4,680, and the recent swing high at $4,785. A sustained recovery above the $4,680–$4,785 band would be required to neutralize the downside bias and potentially retest the descending SMA cluster above $4,700 [1].
CONCLUSION
Gold is under significant bearish pressure as geopolitical tensions between the US and Iran escalate, threatening key support levels. Technical indicators point to a corrective phase, with immediate risks to the downside unless buyers regain control. The market impact is high, and traders are closely watching for further developments and potential recovery signals.