Gold Price Forecast: XAU/USD meets buyers around $5,000, remains under pressure

Valeria Bednarik FXStreet

XAU/USD Current price: $5,110

Market participants continue to pile up on the US Dollar in a risk-averse environment.
The Middle East crisis continues to escalate, prompting investors to seek safety.
XAU/USD is set to extend its decline in the near term.

Spot Gold is heavily down on Tuesday, with the XAU/USD pair trading around $5,110 in the American afternoon, after briefly piercing the $5,000 mark. Despite the escalating crisis in the Middle East and the subsequent risk aversion dominating financial markets, the bright metal is unable to attract investors. Instead, market players are piling up into the US Dollar (USD).

The Greenback reached its intraday peak early in the American session, losing some ground afterwards but still holding on to substantial intraday gains against most major rivals. Meanwhile, global indexes remain under pressure, although Wall Street managed to bounce from its early lows.

The ongoing Iran war continues to escalate, leaving little room for a change in market sentiment. Whether investors will continue to buy USD or switch to the bright metal at some point remains unclear.

Upcoming United States (US) employment data may clear a bit of the picture. The US will see the release of the ADP Employment Change report on Wednesday, followed by weekly unemployment claims on Thursday and the February Nonfarm Payrolls (NFP) report on Friday. If figures disappoint, the USD may lose impetus, and safety demand could shift to Gold.

XAU/USD short-term technical outlook

In the 4-hour chart, XAU/USD has an increased bearish potential. The near-term bias turns mildly bearish after price slipped below the rising 20-period Simple Moving Average (SMA) near $5,260 while holding above the 100- and 200-period SMAs, which continue to slope higher and preserve the broader uptrend context. The Relative Strength Index (RSI) indicator bounced modestly, but stands around 37, while the Momentum indicator maintains its downward slope within negative levels, favouring additional downside in the near term.

Immediate resistance emerges at the broken 20-period SMA around $5,260, and recovery attempts below this level would keep sellers in control, with a stronger barrier aligned near the recent consolidation area around $5,330 and then the $5,370 region. On the downside, initial support appears around the psychological $5,100 area in line with the latest price troughs, followed by more significant support at the 100-period SMA near $5,095, where a bounce would be consistent with a pullback within a broader uptrend. A clear break below the 100-period SMA would expose the 200-period SMA around $5,020 as the next downside level, where longer-term trend followers would look for signs of demand to re-emerge.

In the daily chart, XAU/USD tested buyers' resolve around a rising 20-day Simple Moving Average (SMA) near $5,060, with the 100- and 200-day SMAs keep advancing well below the market. The Momentum indicator gains downward traction yet above its midline, while the RSI indicator also heads south just above its midline, skewing the risk to the downside without confirming lower lows ahead.

(The technical analysis of this story was written with the help of an AI tool.)

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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