Gold prices rose during Monday’s trading session, heading higher for the second consecutive session, with the yellow metal currently trading near the key level of $4,100 per ounce.
Gold is currently trading above the weekly pivot point of $4,067; if it manages to hold above this level, it could rise toward the first weekly resistance level of $4,151. Breaking above this level would likely lead to further gains, with the next resistance level at $4,250.
If gold fails to maintain trading above the weekly pivot point of $4,067, it will retest support levels near $3,968 then $3,883.
In terms of geopolitical tension, The week begins, as it often has this year, with the ongoing Middle East conflict clouding sentiment.
Yet markets were cheering signs of a pause, at least temporarily, in fighting between the United States and Iran. According to The New York Times, President Donald Trump has opted to halt about two weeks of consecutive attacks on Iran in an attempt to prevent Washington’s stockpile of antimissile interceptors and air defense munitions in the Middle East from dwindling.
While the U.S. ambassador to the United Nations appeared to downplay these reports, the fact remains that a tit-for-tat exchange of strikes in the Gulf had paused for a second consecutive day on Sunday. Iran, for its part, also reportedly indicated that it too would not carry out strikes as long as the U.S. bombing does not restart.
Whether the pause opens a window for diplomatic efforts to forge a renewed ceasefire is still uncertain. But the developments were enough to send oil prices down sharply to roughly $91 a barrel on Monday.
Last week, Brent crude futures, the global oil benchmark, briefly topped $100 a barrel following reported attacks by Houthi militants in Yemen on Saudi tankers in the Red Sea. The strikes sparked fears that disruptions to Middle East oil flows may expand beyond the Strait of Hormuz to include the Bab el-Mandeb Strait, another critical waterway that connects the Red Sea with the Gulf of Aden.
On the economic data front, The Federal Reserve is due to unveil a fresh interest rate decision after a two-day meeting on Wednesday, with policymakers likely to be paying close attention to the impact of the Iran war on inflation.
A recent surge in oil prices threatened to ignite concerns over a wave of inflation that could persuade the Fed to lift rates in response. There is just under a one-in-three chance that the central bank opts to increase borrowing costs, although wagers are currently forecasting a 66% probability that rates will be left unchanged at a range of 3.5% to 3.75%.
Also, all eyes will be on the U.S. personal income and spending report for June, which will fold in the latest reading of core personal consumption expenditures — the Fed’s preferred inflation gauge.
Economists at Deutsche Bank anticipated that core PCE, due out on Thursday, will increase by 0.19% month-on-month, bringing the annual rate up to 3.3%. The Fed has set the goal of keeping inflation at 2%.
Finally, the U.S. will release the preliminary estimate of GDP for the second quarter of 2026, with analysts expecting the growth rate to rise to 2.3%, up from the 2.1% recorded in the previous quarter.