A sharp rebound in the US Dollar kept gold prices firmly restrained at the start of the trading week, dampening upward momentum across precious metals. Spot gold struggled to capitalize on early gains in Asian trading, hovering near $4,150 per ounce in a quiet session dominated by contrasting macroeconomic signals. Investors moved past Friday's weaker US employment figures, driving the Greenback to a fresh high since April 2025. This resurgence in the dollar emerged as the primary headwind capping bullion, even as declining bets for an October interest rate increase by the Federal Reserve provided a baseline of support to prevent steeper losses.
Safe-Haven Dollar Outshines Bullion Amid Global Conflicts
Expectations surrounding the path of US monetary policy remain an active driver of market positioning. Data from CME Group's FedWatch Tool indicates traders still price in an 85% probability that the US central bank will raise borrowing costs before the year concludes. Simultaneously, escalating instability across the Middle East and the widening conflict between Russia and Ukraine fueled substantial demand for the US Dollar as a preferred haven asset. Iranian Foreign Minister Abbas Araghchi stated that while no military resolution exists for the confrontation with the US, Tehran stands prepared to resume conflict. Iranian parliament speaker Mohammad Bagher Ghalibaf reinforced this stance, declaring that the Strait of Hormuz will remain closed until specific conditions are satisfied.
Regional security concerns deepened further after Rashad al-Alimi, head of Yemen's governing council, announced new military operations aimed at recapturing areas under Houthi control. Concurrently, Ukraine documented deadly Russian airstrikes across the Kyiv region, Kharkiv, and Dnipro. Ukrainian President Volodymyr Zelenskyy addressed the attacks in a statement on X, affirming that Russia will encounter a direct response. These parallel geopolitical flashpoints maintain elevated risk premiums, systematically channeling capital into the US Dollar and restraining bullion buyers. Market participants are now awaiting the US ISM Services PMI release and scheduled remarks from influential FOMC officials to provide directional momentum.
Technical Indicators and Overhead Resistance Levels
From a chart perspective, gold's technical trajectory remains tilted toward the downside in the near term. The initial barrier to any recovery rally stands at the 61.8% Fibonacci retracement level of $4,225, followed by the 100-period simple moving average situated at $4,269. A sustained push beyond these levels would encounter more formidable hurdles at the 50% retracement mark of $4,314 and the 38.2% threshold at $4,403. Conversely, downside protection is established at the 78.6% retracement level of $4,098. If selling pressure intensifies, a broader structural floor rests around the prior swing low of $3,936, where buyers previously stepped in.
Live market metrics reflect gold futures trading near $4,159, marking a minor 0.08% decline from the previous session close of $4,162. Over the preceding 52 weeks, prices have spanned a wide range between $3,901 and $5,586, with current trading activity registering at 0.14 times the 20-day moving average volume. Momentum indicators highlight an RSI(14) of 34 alongside a bearish MACD reading of -67.11 against a signal line of -44.32. Moving average configurations confirm a prolonged downtrend, with the 20-day EMA at $4,295, 50-day EMA at $4,339, and 200-day EMA at $4,442 forming a death cross pattern. Bollinger Bands place the asset between $4,116 and $4,521, while daily volatility measured by the 14-day ATR stands at 92.54. Immediate intraday pivot points sit at $4,167, with overhead resistance at $4,182 and initial support at $4,144.
Currency Fluctuations Across Global Foreign Exchange Markets
The Greenback's broad rally reverberated through major currency pairs, exerting notable pressure on international peers. The Euro exhibited the greatest weakness, falling to 1.1312, its lowest level since May 2025 and well below the peak of 1.2082 recorded in January. The drop reflects an accumulation of dollar strength, geopolitical friction, and ongoing concerns regarding European vulnerability to volatile energy costs.
The Australian Dollar also retreated, with AUD/USD slipping toward 0.6900 in late Asian hours under the weight of dollar dominance and geopolitical friction in Eastern Europe and the Middle East. Traders in that pair remain focused on crude oil valuations, Treasury yields, and monetary policy cues from the Reserve Bank of Australia. Meanwhile, USD/JPY recovered earlier losses to reclaim the 158.00 threshold. While geopolitical flight supported the pair, further gains face potential limits from expectations of tighter Bank of Japan policy and market intervention vigilance, leaving broader financial markets tightly tethered to dollar dynamics.
