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- Gold price edges higher in Tuesday’s Asian session.
- A memorandum of understanding to end the war has been signed by Trump, JD Vance, and the speaker of Iran’s parliament.
- Swap traders priced in lower chances of a rate hike by December.
Gold price (XAU/USD) gains momentum during the Asian trading hours on Tuesday. The precious metal extends the rally after the United States (US) and Iran reached a comprehensive framework deal to end hostilities, easing inflation concerns.
Bloomberg reported on Monday that US President Donald Trump and Vice President JD Vance signed an electronic copy of a memorandum of understanding with Iran. Trump noted that the Strait of Hormuz “is already partially opened,” and “it’ll be completely opened” on Friday.
“The gold market is moving past the conflict and pricing it out. The peace deal news took down Treasury yields, the dollar, and oil, and those were the biggest inflation and cross asset risks,” said Phillip Streible, chief market strategist at Blue Line Futures.
However, caution lingered as both sides offered differing accounts on key issues. Iran intends to collect certain “fees” in the critical waterway, while Trump said it would fully reopen Friday without tolls. Trump said on Monday that if Iran failed to reach a final nuclear accord with the US, he would restart military attacks on Tehran.
Bets on Federal Reserve (Fed) rate hikes receded after the framework deal, supporting the yellow metal, a non-yielding asset. Traders cut the chance of a US rate hike in December to 58% from nearly 70% last week, according to the CME FedWatch tool.
The Fed is due to announce its next policy decision on Wednesday. Economists expect the US central bank to keep its benchmark rate in a range of 3.50% to 3.75% as it waits to see how the war’s energy-price shock ripples through the economy.
XAU/USD daily chart
Gold keeps the bearish vibe in near term below the key 100-day SMA
In the daily chart, the near-term tone of XAU/USD stays bearish as price holds beneath the Bollinger middle band and well below the 100-day simple moving average (SMA), keeping the broader recovery structure capped. The Relative Strength Index (RSI) at about 43 sits below the midline, hinting at lingering downside pressure despite the recent attempt to stabilize.
On the topside, initial resistance emerges at the June 9 high of $4,363. The next hurdle to watch is the Bollinger SMA midline near $4,415, with the upper Bollinger band around $4,685 and the 100-day SMA at roughly $4,762 forming a broader supply zone if a rebound extends. On the downside, the lower Bollinger band at about $4,145 marks the next notable support, and a decisive break beneath this area would expose further weakness toward prior swing lows.
