Gold price retreats from $4,700 as easing tensions in the Strait of Hormuz weaken safe-haven demand
Gold has entered a consolidation phase, with bullish momentum fading and the Relative Strength Index (RSI) entering overbought territory. Geopolitical conditions remain the core factor: Axios News quoted sources saying two U.S. officials confirmed that President Trump announced the U.S. Navy has opened a traffic separation scheme for ships in the Strait of Hormuz.
Strong resistance has formed around $4,700, capping gold's upside. Meanwhile, U.S. housing data has slightly improved; the 4-week average change in ADP employment is 11,750, higher than the previous 9,500.
U.S. building permits in July rose 4.3% month-on-month to 1.433 million units, reversing a 2.6% drop in June but missing market expectations of 5%. The Conference Board's U.S. consumer confidence index missed expectations, recording 90.2 (editorial note: lower than 90.2). In August, residents' views on the business environment and the job market improved slightly.
Boston Fed President Susan Collins gave a hawkish signal, emphasizing inflation remains too high and expressing concern over price stability. She believes the current labor market is near full employment and economic growth is close to trend levels.
According to PrimeTerminal data, the money market remains doubtful about a Fed rate hike in September: the probability of a 25 basis-point increase is about 43%, while the probability of holding rates unchanged is 57%.
The market's next focus will be the Fed's preferred inflation gauge—the core Personal Consumption Expenditures (PCE) Price Index, as well as the speech by the new Fed Chair, Kevin Walsh, at the Jackson Hole Global Central Bank Annual Meeting.
The U.S. will also release durable goods orders, Gross Domestic Product (GDP), and initial jobless claims, among other economic data.
Spot gold technical outlook: $4,700 resistance encountered
The first support is at $4,600, followed by the 200-day Simple Moving Average (SMA) at $4,519; below that, the $4,500 mark and then the 100-day moving average at $4,379.
To restart an upward trend, gold prices must regain a firm footing above $4,700. If a valid breakout occurs, a rally to the May 7th high of $4,764 is expected, followed by a test of $4,800, with the next target set at $5,000.
Editor: Guo Jian
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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