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Spot Gold (XAU/USD) fluctuated near $4,000 on Thursday, constrained within a narrow intraday range. The metal avoided a breakdown below its recent multi-month low of $3,959 as the US Dollar (USD) lost some upward momentum despite lingering near a one-year high. The USD's strength, driven by expectations of prolonged high interest rates in the US, continues to weigh on gold's price action. Traders are closely monitoring whether the $4,000 level can act as a psychological support to trigger a broader rebound.
The mixed performance of gold highlights the tug-of-war between safe-haven demand and the USD's dominance. While weaker USD momentum offers temporary relief to gold, the absence of strong macroeconomic catalysts limits its upside potential. Market participants are also watching for clues on central bank policy shifts, particularly from the Federal Reserve, which could influence both the USD and gold dynamics.
For Gulf investors, the USD's resilience remains a critical factor. A sustained break below $4,000 could test deeper support levels, while a sustained rebound above $4,200 might signal a shift in sentiment. Traders should monitor upcoming US inflation data and Fed minutes for directional clues.
