Gold rangebound as Iran tensions and Fed outlook weigh

Gold traded in a narrow band after US-Iran mediation talks in Pakistan failed over the weekend. Renewed concern about shipping through the Strait of Hormuz pushed oil prices higher and limited immediate downside for the metal, while stronger US economic data supported expectations that the Federal Reserve will keep rates higher for longer.

The stalled talks raised the perceived risk of disruption to crude shipments through the Hormuz chokepoint. That risk placed upward pressure on oil, which in turn provided some safe-haven demand for gold even as other forces restrained gains.

Recent US data came in firmer than markets expected, strengthening the US dollar and lifting Treasury yields. Higher yields make non-yielding assets such as gold less attractive to some investors and have narrowed the metal’s upside potential.

Traders are weighing a geopolitical premium tied to the Iran situation against a yield-driven premium linked to delayed rate cuts. Technical indicators reflect the stalemate: immediate support sits near $4,700, and gold is trading above a 100-period simple moving average around $4,606. A descending 200-period SMA is close to $4,870. The recent swing high at $4,804 is the next resistance level; a sustained move above that would expose the 4,870 area and the $5,000 mark. A break below $4,700 could prompt a retracement toward the $4,600 zone. The relative strength index is around the mid-50s, indicating little directional momentum.

Market participants are watching any follow-up US-Iran dialogue, movements in oil prices, and upcoming US economic releases that could change Fed rate expectations. Gold’s short-term recovery has entered a third week with momentum easing and market participants awaiting a clear catalyst to break the current range.