Gold prices fell Monday as the U.S. dollar gained strength and tensions rose between the U.S. and Iran. Spot gold (XAUUSD) traded at $4804.18, down $27.42, or 0.57%, by 11:52 GMT.
Renewed conflict in the Middle East followed a brief ceasefire last week. Reports indicate the Strait of Hormuz is closed again to tanker traffic. This pushed oil prices, Treasury yields, and the U.S. Dollar Index higher.
Rising yields make gold less attractive because it offers no interest. A stronger dollar also makes gold more expensive for international buyers, reducing demand. The U.S. seizure of an Iranian vessel further escalated the situation, prompting Iran to warn of retaliation.
Technical indicators show mixed signals for gold’s price movement. The 200-day moving average at $4217.83 suggests an uptrend. However, the 50-day moving average at $4892.84 indicates weakness, given the current price.
Gold faces resistance around $4850.68 to $5028.04, which stopped a rally Friday. Major support lies between $4744.34 and $4541.88, with the upper level currently under test. The market holds a neutral outlook with a slight upside bias.