On Wednesday during Asian trading hours, spot gold encountered significant resistance after hitting the psychological level of $4,500 and a one-week high, failing to continue the strong gains of the previous two days.

As the market gradually digested the impact of the recent US military action against Venezuela, risk appetite rebounded in stages, and some funds chose to realize profits at high levels, causing gold prices to fall slightly.

However, the overall pullback was relatively limited, indicating that the bullish structure has not been significantly damaged. Although major indices such as the Nasdaq continued to hit new historical highs and market sentiment appeared optimistic, geopolitical uncertainties have not eased significantly.

The United States has recently adopted a tougher stance on several international issues, including discussions surrounding Greenland and strong statements against some Latin American countries.

Meanwhile, limited progress in the Russia-Ukraine situation and continued volatility in the Middle East have collectively maintained market demand for safe-haven assets, providing support for gold during its decline.

On the monetary policy front, market bets on further interest rate cuts by the Federal Reserve continue to rise. Interest rate futures pricing indicates that traders have already priced in the possibility of multiple rate cuts this year, making it difficult for the dollar to maintain its upward momentum after rebounding in the previous trading day.

Several Federal Reserve officials emphasized that interest rate adjustments still need to be finely calibrated based on employment and inflation data, and that the relative attractiveness of gold, a non-interest-bearing asset, remains until the expectation of declining real interest rates is disproven.

The market remains cautious, awaiting guidance from key US economic data later this week. Friday's non-farm payroll report and next week's inflation data will significantly influence market expectations regarding the Federal Reserve's policy path and will be crucial triggers for gold price movements in the next phase.

Prior to this, ADP employment data, ISM services PMI, and JOLTs job vacancy data are more likely to cause short-term fluctuations.

From a technical perspective, gold has entered a consolidation phase at high levels. The price remains above the 100-hour moving average, which is around $4400 and continues to rise, forming a significant dynamic support level.

Momentum indicators show that the MACD has fallen below the signal line and is below the zero axis, indicating increased short-term downward pressure; the RSI has fallen back to around 48, which is in the neutral range, reflecting that the forces of bulls and bears are temporarily in balance.

If the momentum stabilizes and strengthens again, gold prices are expected to test higher levels again; conversely, if they break below the key moving average support, they may retest the dense support area around $4,450-$4,445, but in the context of a medium-term bullish trend, this is more likely to be seen as a technical correction.


Editor's Note:

Overall, the current pullback in gold prices reflects more the result of profit-taking at higher levels and a temporary recovery in risk sentiment than a trend reversal. Recurring geopolitical tensions and expectations of a Fed rate cut continue to provide significant support at the bottom.

Gold prices may remain range-bound at high levels ahead of the release of key macroeconomic data. However, if external uncertainties escalate again, gold prices still have the potential to strengthen again.