Gold Price Forecast: XAU/USD Pulls Back Below $4,500 as Yields Recover Some Ground

During the European trading session on Thursday, spot gold came under pressure and traded around $4,490, down approximately 0.7% on the day. Earlier, the metal had touched an 11-week high of $4,527, but momentum faded and it gave back those gains.

**Rising U.S. Treasury Yields Weigh on Gold**

Gold turned lower during the day, pressured by a rebound in U.S. Treasury yields. After declining on Wednesday, yields partially recovered on Thursday, with the benchmark 10-year note yield moving higher, reducing the appeal of non-yielding gold. At the same time, market reports indicated that geopolitical tensions in the Middle East had escalated somewhat, which initially provided support for the safe-haven dollar and added indirect pressure on dollar-denominated gold.

**Technical Outlook: Key Resistance at $4,500**

From a technical perspective, the $4,500 level remains the immediate resistance for gold. The metal's rapid pullback after approaching this area suggests solid overhead supply. Analysts note that a decisive break and close above $4,500 could open the door for further upside, while repeated failures to clear this level may trigger a deeper correction. On the downside, support is seen near recent swing lows, with the Relative Strength Index (RSI) still in bullish territory but showing signs of fading momentum.

**Short-Term Direction Hinges on Data and Fed Expectations**

Looking ahead, the near-term trajectory for gold will largely depend on upcoming U.S. economic data and shifts in market expectations regarding Federal Reserve policy. If inflation figures continue to cool, expectations for rate cuts could firm, providing a tailwind for gold. Conversely, any signs of sticky inflation in core services could keep the Fed's tightening bias intact, potentially capping gold's upside. Market sentiment surveys suggest that most Wall Street analysts remain optimistic on gold's short-term prospects, but the metal's reaction around key technical levels will be closely watched.