Gold clings to gains above $4,800 as softer USD offsets easing geopolitical tensions
|- Gold attracts some buyers on Tuesday as the USD pauses the recent recovery from a four-year low.
- Kevin Warsh’s nomination as the next Fed chair could limit USD losses and cap the precious metal.
- Easing geopolitical and trade tensions might keep a lid on any further gains for the XAU/USD pair.
Gold (XAU/USD) builds on the previous day's bounce from the $4,400 neighborhood, or the lowest level since January 6, and gains some follow-through traction during the Asian session on Tuesday. The US Dollar (USD) edges lower and moves away from an over one-week high, touched on Monday, and assists the commodity to attract some buyers following a steep fall over the past two days. US President Donald Trump’s nomination of Kevin Warsh as the next Federal Reserve (Fed) chair, along with upbeat US ISM Manufacturing PMI released on Monday, helps limit deeper USD losses.
Meanwhile, signs of de-escalation of US-Iran tensions over the latter's nuclear program, along with the US-India trade deal, remain supportive of a positive risk tone. Apart from this, the CME Group's decision to raise margin requirements on precious metals futures could turn out to be another bearish development for the Gold and cap the upside. Hence, it will be prudent to wait for strong follow-through buying before confirming that the recent sharp corrective slide from the $5,600 mark, or the record high touched last week, has run its course and positioning for any meaningful appreciation.
Daily Digest Market Movers: Gold draws support from modest USD downtick
- US President Donald Trump on Friday nominated Kevin Warsh to succeed Jerome Powell as the next Federal Reserve Chair in May, pending Senate approval. Warsh’s background as a hawk suggests that he would remain vigilant if inflation expectations begin to rise.
- Adding to this, the CME Group said over the weekend that it would increase margins on precious metals futures starting from the close of markets on Monday. This prompted liquidation for the second straight day and dragged the Gold to a four-week low on Monday.
- On the economic data front, the Institute for Supply Management reported on Monday that the US factory activity grew for the first time in a year. In fact, the Manufacturing PMI rose to 52.6 in January, marking a significant recovery from 47.9 in the previous month.
- Meanwhile, Trump announced on Monday that the US and India have reached a trade deal and will immediately move to lower tariffs on each other’s goods. Moreover, Iran and the US are expected to resume nuclear talks on Friday, further boosting investors' confidence.
- The US Dollar ticks lower on Tuesday and moves away from an over one-week high, touched the previous day, lending some support to the Gold during the Asian session. The aforementioned negative factors, however, might keep a lid on any further gains for the bullion.
- Traders on Tuesday will take cues from the release of the US JOLTS Job Openings data. This will be followed by the US ADP report on private-sector employment and US ISM Services PMI on Wednesday, which, along with Fed speak, will drive the USD and the XAU/USD pair.
Gold could climb further while above 38.2% Fibo. level
The commodity showed resilience below the 50-day Simple Moving Average (SMA) and bounced off the 50% retracement level of the July 2025-January 2026 rally on Monday. The upward slope of the SMA suggests dips could be supported. Adding to this, the XAU/USD pair currently holds above the 38.2% Fibonacci retracement level, pegged around the $4,645-4,650 area, and should offer nearby support. Moreover, the Relative Strength Index (RSI) sits at 51.91 and edges higher, hinting at stabilizing momentum.
However, the Moving Average Convergence Divergence (MACD) line stands below the Signal line and below zero, reinforcing a bearish tone. The negative histogram widens, pointing to intensifying downward momentum. Meanwhile, any further move up could refocus the 23.6% retracement at $4,995.94, while failure to hold the first support would leave the recovery vulnerable to further consolidation.
(The technical analysis of this story was written with the help of an AI tool.)
US Dollar Price Today
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Canadian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.15% | -0.18% | -0.08% | -0.07% | -0.81% | -0.50% | -0.17% | |
| EUR | 0.15% | -0.03% | 0.04% | 0.08% | -0.66% | -0.34% | -0.02% | |
| GBP | 0.18% | 0.03% | 0.06% | 0.11% | -0.63% | -0.33% | 0.01% | |
| JPY | 0.08% | -0.04% | -0.06% | 0.03% | -0.70% | -0.41% | -0.07% | |
| CAD | 0.07% | -0.08% | -0.11% | -0.03% | -0.74% | -0.44% | -0.10% | |
| AUD | 0.81% | 0.66% | 0.63% | 0.70% | 0.74% | 0.30% | 0.67% | |
| NZD | 0.50% | 0.34% | 0.33% | 0.41% | 0.44% | -0.30% | 0.34% | |
| CHF | 0.17% | 0.02% | -0.01% | 0.07% | 0.10% | -0.67% | -0.34% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
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