Gold Tries to Rebound Near $4,000 as Dollar Rally Pauses

Key Moments

Gold Holds Near $4,000 After Hitting Multi-Year Low

Gold (XAU/USD) is stabilizing after a sharp slide, recovering from levels near its weakest reading since November 2025, which was reached the previous day. During the latter part of the Asian session on Thursday, the metal is trading close to the $4,000 round figure, helped by a modest pullback in the US Dollar (USD) as traders adjust positions ahead of the upcoming US Personal Consumption Expenditures (PCE) Price Index release.

The PCE data is viewed as a key input for the Federal Reserve’s (Fed) policy outlook and is expected to play a critical role in shaping expectations for interest rates. Given gold’s lack of yield, any shift in views on the Fed’s path is likely to feed directly into bullion pricing.

Cooling Inflation Fears Temper Fed Hike Expectations

Near-term inflation concerns have eased, coinciding with a notable drop in Crude Oil prices following the reopening of the Strait of Hormuz. In addition, a temporary 60-day sanctions waiver that permits the production, delivery, and sale of Iranian crude oil, petroleum, and petrochemical products has driven oil to its lowest level since before the US-Iran war.

These developments are expected to reduce upstream inflation pressures, prompting traders to pare back expectations for further Fed rate increases. As a result, US Treasury yields have moved lower, limiting additional upside in the USD and offering some support to gold prices.

Dollar Support and Risk Sentiment Still Weigh on Bullion

Despite the recent pullback in yields and inflation expectations, the broader policy backdrop remains supportive for the Greenback. According to CME Group’s FedWatch Tool, market participants continue to assign more than an 80% probability that the Fed will raise borrowing costs by the end of this year, which helps contain any substantial downside in the USD.

At the same time, a global selloff in technology stocks earlier this week has dampened risk appetite. The risk-off tone underpins demand for the safe-haven Dollar, adding pressure on gold. This combination supports the case that the recent bounce in XAU/USD could be short-lived, with rallies likely to attract renewed selling interest. The move and acceptance below the $4,000 psychological threshold reinforces the bearish narrative for the metal.

Technical Picture: Rebound Seen Vulnerable Below Key Moving Average

On the 4-hour chart, repeated failures around the 100-period Simple Moving Average (SMA) have been followed by an overnight break below the prior year-to-date low and the $4,000 level. This breakdown has been interpreted as a fresh signal for sellers to re-enter the market.

However, the Relative Strength Index (14) currently sits near oversold territory, around 28. This reading indicates that the downside momentum may start to moderate, arguing for caution among bears in the very near term. A period of consolidation or a modest corrective bounce could emerge before the next leg lower is established.

The Moving Average Convergence Divergence (MACD) indicator is in negative territory and has deteriorated further, reinforcing the view that any recovery attempts are likely to encounter resistance while XAU/USD remains well below the 100-period SMA near $4,258.00.

On the upside, a sustained recovery above $4,000 could bring the $4,065-$4,070 region into focus, where fresh supply is anticipated. This zone is expected to act as a ceiling, keeping gains limited around the $4,100 level. Bulls would need a decisive break above this barrier to alleviate immediate bearish pressures and pave the way for a more durable move higher toward the 100-period SMA.