Gold Price Hovers Near $4,100 as Buyers Hold Back Amid Ongoing Iran Tensions

Gold prices rose over 1% on Monday to regain the $4,100 level, but buyers are being cautious as they assess whether the lull in fighting between the US and Iran could last amid ongoing diplomatic efforts.

The metal's price is influenced by reduced haven demand for the US Dollar (USD) across the board and a fall in US Treasury bond yields, which follows a two-night pause in strikes between the US and Iran.

However, Gold traders are refraining from creating big positions ahead of the Federal Reserve monetary policy meeting due to begin on Tuesday, with the verdict set to be announced on Wednesday. Markets are pricing in roughly a 33% chance of a Fed rate hike this week, up from 12% seen 10 days ago.

The Bear Cross and negative momentum in Gold's daily technical setup also caution optimists, despite the metal holding just above the 21-day simple moving average (SMA) at $4,069.60.