Gold (XAU/USD) prices declined on Wednesday, retracing gains from Tuesday and approaching the $4,300 level as the US Dollar Index (DXY) continued its rally, trading just below 101.00, its highest point in nearly two months [1]. The recent hawkish stance from the Federal Reserve has contributed to the dollar's strength and higher US Treasury yields, both of which are exerting downward pressure on gold prices [1].
Market participants are closely monitoring the United Nations General Assembly, where US and Iranian officials are negotiating a potential peace deal. US Special Envoy Steve Wickoff confirmed ongoing talks, and President Donald Trump described a recent meeting with Iranian officials as “very productive,” noting “a lot of momentum” toward an agreement [1]. Optimism around these negotiations has led to a sharp decline in oil prices, with the US benchmark WTI trading nearly 12% below last week’s highs. This drop in oil prices is providing some support to precious metals, including gold, despite the prevailing bearish sentiment [1].
From a technical perspective, XAU/USD is trading in a range between $4,300 and $4,400, with indicators such as the Relative Strength Index (RSI) remaining below 50 and the Moving Average Convergence Divergence (MACD) in negative territory, signaling growing bearish momentum [1]. Key support is seen near Tuesday’s low at $4,290, with further downside risk toward the August 7 and September 16 lows around $4,230, which also marks the neckline of a bearish Head & Shoulders formation [1]. Resistance remains at $4,400, with further upside capped by the September 3 high at $4,510 and the 200-day Simple Moving Average at $4,541 [1].
Investors are awaiting upcoming US business activity data to further clarify monetary policy expectations, which could influence gold’s next move [1].
CONCLUSION
Gold prices are under pressure as a stronger US dollar and hawkish Fed outlook weigh on the market, despite some support from falling oil prices. Technical indicators suggest bearish momentum, with key support levels in focus. Market participants are watching US-Iran negotiations and upcoming US economic data for further direction.