• Gold kicks off the new week on a weaker note, though it lacks follow-through and bounces off $4,600.
• Inflationary concerns bolster bets for higher interest rates globally and undermine the precious metal.
• The USD preserves its bullish bias and turns out to be another factor exerting pressure on the bullion.

Gold (XAU/USD) struggles to capitalize on Friday's goodish recovery from the vicinity of the $4,550 level and kicks off the new week on a weaker note. This marks the second straight day of a negative move and is sponsored by prospects for higher interest rates globally, which tends to undermine the non-yielding bullion. Adding to this, a modest US Dollar (USD) strength turns out to be another factor exerting pressure on the commodity, though the lack of follow-through selling warrants caution for bearish traders.

Investors now seem convinced that the war-driven surge in energy prices would revive inflationary pressures and force major central banks, including the US Federal Reserve (Fed), to adopt a more hawkish stance. In fact, Crude Oil prices advanced to a nearly four-week high on Monday in reaction to US President Donald Trump's threat to target Iran’s power plants and bridges if the Strait of Hormuz is not reopened by Tuesday. Adding to this, Tehran also outlined a new condition and said that the transit through the strategic waterway could resume if part of the revenue is allocated to compensate Iran for war-related damages.

Moreover, Ali Akbar Velayati, an advisor to Iran’s new Supreme Leader, Mojtaba Khamenei, warned that the resistance front could target the Bab el-Mandeb Strait in the Red Sea—another critical chokepoint. This raises the risk of a further disruption to global trade routes and remains supportive of elevated Crude Oil prices. Meanwhile, the upbeat US Nonfarm Payrolls (NFP) report released on Friday signaled a still resilient labor market and boosted speculation that the Fed will hold rates higher for longer to combat inflation. The outlook, in turn, benefits the USD, which contributes to the offered tone around the Gold price.

The XAU/USD pair, however, holds above Friday's swing low and finds decent support near the $4,600 mark. Hence, it will be prudent to wait for strong follow-through selling and acceptance below the said handle before confirming that the recent goodish rebound from the $4,100 mark, or a four-month low touched in March, has run out of steam. Traders now look forward to the release of the US ISM Services PMI for some impetus later during the North American session amid thin liquidity on the back of the Easter Monday Holiday in many global financial markets.

XAU/USD 4-hour chart

Gold remains vulnerable amid a bearish technical setup

From a technical perspective, the $4,600 mark coincides with the 38.2% Fibonacci retracement level of the March downfall and should act as a key pivotal point. The precious metal holds well below the 200-period Exponential Moving Average, keeping the broader trend under downside pressure. The Moving Average Convergence Divergence (MACD) line has slipped below its signal, and both fluctuate just under the zero line, with a negative histogram that suggests building selling momentum after the recent failure to sustain gains above $4,750.

Meanwhile, the Relative Strength Index (RSI) at 52 keeps a neutral stance, but its pullback from overbought territory reinforces the idea of fading upside pressure rather than fresh buying interest. In the meantime, immediate resistance emerges around $4,758, where the 50.0% retracement coincides with the latest swing high zone, while a recovery above that level would target the 200-period EMA near $4,791 and then the $4,913 region at the 61.8% Fibo. retracement. Only a clear move back above the EMA cluster would neutralize the current bearish bias.

On the downside, initial support aligns near the 38.2% Fibo. retracement, with a break there exposing a deeper pullback to the 23.6% retracement around $4,411. A sustained drop below that region would open the way toward the psychological $4,300 area.

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