Gold prices remain under pressure as US dollar strength weighs on the metal's fragile recovery. A cautious outlook persists for gold below the 4,360 resistance level and beneath a multi-month trendline extending from the March 2026 highs. At the same time, USDJPY is approaching a critical resistance zone that could determine its next major directional move.

These scenarios were discussed during my daily MENA Call webinars, covering commodities, indices, cryptocurrencies, and UAE equities.

 

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Key Events to Watch

• Summer liquidity risks and their interaction with ongoing Middle East geopolitical tensions.
• Key US economic data releases, particularly tomorrow's US CPI report, with expectations pointing to inflation rising toward 4.2%, and the implications for Federal Reserve policy expectations and Treasury yields.
• The Bank of Japan's monetary policy outlook and intervention risks as USDJPY approaches the multi-decade resistance zone between 160.00 and 163.00 once again.

Key Levels to Watch

Gold

• Resistance: 4,360
• Support: 4,270

USDJPY

• Resistance: 160.00–163.00
• Support: 158.00

USDJPY Price Outlook: Weekly Time Frame – Log Scale

Source: Trading view

From a weekly perspective, USD/JPY has maintained a bullish structure since 2022, respecting the boundaries of a long-term ascending channel while also trading within a shorter-term one-year rising channel that continues to define the pair’s directional bias.

The pair is now challenging the key psychological and multi decade resistance zone at 160-163.

A sustained breakout above 160 could open the door toward 161.30 and 163.20, representing the channel midpoint and a major resistance zone that capped gains in 2024. A successful break above this region would expose the upper boundary of the long-term channel near 165.00 and 168.00.

Beyond that, the longer-term projection points toward 180.00. However, the probability of BOJ intervention is likely to increase significantly as price approaches these levels. Momentum indicators are already showing signs of bearish divergence against price action, suggesting that upside momentum is beginning to slow.

The lower boundary of the one-year ascending channel remains the key support level to monitor.

On the downside, a break below 158.00 and the lower boundary of the one-year rising channel would increase the risk of a deeper correction toward 155.00 and 152.00. A move below these levels would expose the long-term channel support near 147.00.

Gold Price Outlook: Daily Time Frame – Log Scale

Source: Trading view

Latest video on Gold: Dollar Strength Weighs on Gold and Silver

Gold's bearish bias remains visible on the daily chart as price action continues to struggle below the descending trendline connecting the lower highs formed since March 2026. This keeps the bearish outlook intact and aligns with the daily RSI's breakdown below its multi-month triangle pattern, increasing the risk of another decline toward yearly oversold conditions.

From a price action perspective, resistance remains concentrated below 4,360, while 4,270 serves as the key support level.

Bearish Scenario

A breakdown below 4,270 would increase the risk of a deeper decline toward 4,180 and 4,080. These levels will be important in determining whether gold can establish another bullish rebound or extend losses toward the 3,800 region, where longer-term dip-buying opportunities may emerge once again.

Bullish Scenario

A sustained breakout above the multi-month trendline resistance and the 4,360 level would expose gold to the next resistance zones at 4,400, 4,440, and 4,530.

A successful move through these levels would shift attention toward 4,600 and 4,780, where bullish momentum would face another major sustainability test. A sustained breakout above these areas would significantly improve bullish confidence and reopen the path toward the 4,900–5,000 zone.

Following two years of exceptional gains, gold appears to be entering a period of consolidation. Such phases are common after strong trends and may continue until momentum realigns with the potential for another significant upside move.

Written by Razan Hilal, CMT

Follow on X: @Rh_waves