Gold Fails to Break Through $4,100 as Dollar Gains Traction

Gold prices hovered below $4,100 on Thursday, unable to break through resistance as the US dollar gained traction. The Asian session saw gold trading within the same range as the previous day, despite a second consecutive day of buying interest.

The US Federal Reserve's decision to hold interest rates steady at its two-day meeting on Wednesday was widely expected, but the absence of more aggressive monetary policy measures weighed heavily on the dollar and lifted gold prices to their weekly high. However, the on-hold decision drew three dissents who preferred a 25-basis-point rate hike.

The escalating US-Iran tensions have fueled concerns about energy-driven inflation, backing the case for Fed tightening and capping non-yielding bullion. The ongoing conflict between the two nations has disrupted global energy supplies, leading to a sharp rise in crude oil prices. According to TD Securities, 'precious metals have remained weak in the face of hawkish market pricing for the Fed,' with renewed strength in energy markets expected to continue feeding into this narrative.

From a technical perspective, gold remains confined within a familiar range, and its bearish potential remains intact. The 200-day Simple Moving Average (SMA) acts as pivotal resistance, with any sustained move above paving the way for additional gains to $4,490.80.