Gold Outlook: Is XAU/USD Losing Its Safe-Haven Appeal?

In recent trading sessions, XAU/USD has begun to show a consistent neutral bias in the short term. Although price movements remain significant, there is no clear direction or dominant bias on the chart.

Indecision has settled into gold’s price action despite the recent escalation of geopolitical tensions in the Middle East. This suggests that gold’s appeal as a safe-haven asset has not fully consolidated in the short term, even as overall uncertainty remains elevated. If this lack of momentum persists, it could lead to a more prolonged phase of neutrality in the coming sessions.

Gold Loses Momentum

So far, the conflict in the Middle East remains active and in a high-tension phase. Statements and threats continue between Iran, Israel, and the United States, while the Strait of Hormuz remains a critical point for global energy commodity trade, prompting heightened international naval surveillance. There are still no clear signs of an immediate diplomatic de-escalation, and a geopolitical risk premium remains embedded in financial markets.

However, despite this environment, gold has failed to attract consistent demand. The market appears to be favoring substitute defensive assets amid the geopolitical crisis.

Indeed, activity in the iShares Gold Trust ETF shows that capital flows have lost momentum in recent sessions. On March 2, 2026, net inflows totaled only $49.15 million, significantly lower than the $500 million recorded on February 4. This highlight reduced institutional participation and a lack of sustained interest in the metal in the short term.

Source: ETFDB

Part of this dynamic may be explained by the strengthening of substitute markets, particularly US Treasury bonds. The 10-year Treasury yield has recovered above 4.00%, rising consistently in recent sessions. This increase in yields may be enhancing the relative attractiveness of the fixed-income market, which competes directly with gold as a safe-haven asset.

Source: TradingEconomics

In this context, current geopolitical tensions do not appear to be fully benefiting gold. Investor interest has shifted toward other defensive assets, which could limit the metal’s ability to regain prominence and keep it within a structurally neutral phase in the coming sessions.

 

Confidence Declines, But Not Aggressively

It is important to remember that gold historically benefits from sharp declines in confidence indicators, as these typically boost demand for safe-haven assets.

Currently, the Fear and Greed Index stands around 32 points, reflecting a notable decline but still far from “extreme fear” territory. The drop in the indicator has not been rapid enough to signal a generalized panic scenario.

Source: CNN

As long as confidence indicators do not move into extreme levels, the market may remain in a cautious phase without triggering aggressive demand for gold. This reinforces the possibility that XAU/USD will continue trading within a neutral environment in the coming sessions.

 

Technical Outlook for Gold

Source: StoneX, Tradingview

• The Uptrend Remains Relevant: For several months, gold has maintained a dominant upward trendline. So far, no sufficiently deep bearish move has emerged to threaten this technical structure. However, recent price action shows growing indecision, which, if sustained, could lead to a short-term sideways range for XAU/USD.
   

• RSI: The RSI remains near the neutral 50 level, indicating equilibrium between bullish and bearish momentum in the short term. As long as this dynamic persists, there is no clear dominance from buyers or sellers.
   

• MACD: The MACD histogram remains close to the zero line, also reflecting balance in short-term moving average strength. This supports the view of a technical indecision phase in gold’s price action.
   

Key Levels to Watch:

• $5,400 – Crucial resistance: Psychological level near historical highs. A sustained move toward this zone could consolidate dominant buying pressure and extend the uptrend in the coming weeks.
   
• $5,000 – Near-term barrier: Psychological level that has recently generated price neutrality. As long as gold does not move decisively away from this area, a short-term sideways range may persist.
   
• $4,752 – Critical support: Area aligned with recent lows, the primary upward trendline, and the 50-period simple moving average. A sustained break below this level would threaten the current bullish structure and could open the door to a more dominant bearish bias.
   

Written by Julian Pineda, CFA, CMT – Market Analyst

Follow him on: @julianpineda25