Zhang Jinlei: Middle East conflict and easing rate expectations turn gold at 4600 into a battleground for bulls and bears

March 31: Yesterday, gold saw a ranging-to-slightly-bullish move. From the opening, it began to rise, and the long position taken above 4480 also brought in a considerable amount of gains. After touching the intraday high at 4580 during the US session, it failed to break through and then pulled back. Ultimately, gold closed at 4510 dollars, with the daily chart ending on a two-day consecutive gain.

Tuesday (March 31): Yesterday, a single line from Federal Reserve Chair Powell—“energy shocks can be temporarily ignored”—completely reversed the market’s expectations for the interest-rate path. The market shifted from still pricing in potential rate hikes from last week to, yesterday, beginning to reprice the possibility of rate cuts. Gold’s safe-haven attribute is moving from being “suppressed” back to “returning,” and the 4500-dollar level has become a strategic battleground for both bulls and bears.

The Middle East conflict has entered its fifth week, and the situation is still developing in the direction of expansion. Over the weekend, Yemen’s Houthi forces carried out attacks on Israel for the first time, marking a further expansion of the war. Israel is facing pressure from fighting on multiple fronts. However, Trump extended the strike timetable, and the US and Iran dialogues have again left a window for diplomacy. This contradictory state is causing gold price volatility to intensify, but the risk of the war expanding is also accumulating.

From a technical perspective: In the early hours of today, the rally broke through the prior trendline high at 4600. There is also a possibility that the short-term action could extend upward. However, the upside still seems unlikely to have much room, and the upward momentum is determined by the US Dollar Index. Therefore, even if the rally continues, the pace will not be strong. For intraday gold, focus mainly on the 4530-00 area for contention. If an unexpected pullback occurs and it falls back below this level, then today’s early rally will be declared over, and the market will return to a weaker sideways-consolidation trend. If the price enters a scenario where it holds above 4600, then the short-term action may be able to test 4700-30, or even the possibility of 4800—though that would require a time process, and during that process, you also need to see how the US Dollar Index’s operating rhythm adjusts accordingly.

In short: For now, gold friends, you can keep a steady stance—watch more and move less—waiting for a clearer stabilization signal. The current pricing logic has just been rebuilt. Although the direction has turned bullish, there is still the possibility of back-and-forth, so it’s not advisable to aggressively chase higher prices. Watch this week’s nonfarm data and Trump’s final deadline on April 6. If the data is weak or tensions escalate, gold may be able to push higher further.

Therefore, for intraday operations, the following suggestions are offered:

Gold: Sell at 4575-4580, stop loss at 4590, with targets at 4500-4450. If it regains and holds above 4600, then directly chase longs, targeting 4680-4700.

Key economic data and events to watch today: Tuesday, March 31, 2026

21:00 US January FHFA House Price Index, month-over-month

21:00 US January S&P/CS 20 City Home Price Index, year-over-year

21:45 US March Chicago PMI

22:00 US February JOLTs job openings

22:00 US March Conference Board Consumer Confidence Index

03:00 the next day: Fed Governor Barr speaks on stablecoins

03:10 the next day: Fed Bowman delivers remarks

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Responsible editor: Chen Ping