The rally marks the strongest percentage gain for the metal since February, offering relief after prices flirted with the $4,000 threshold last week. While the cooling of oil prices—now sliding below $80 a barrel—eases immediate inflationary pressure, market experts remain cautious. Michele Schneider of MarketGauge noted that while holding the $4,000 support level is encouraging, the price must reclaim its 200-day moving average near $4,450 to signal a genuine trend reversal.

Risk remains tied to the diplomatic calendar. David Morrison of Trade Nation pointed out that any delay in the scheduled Friday signing of the peace treaty could trigger a swift reversal, potentially dragging gold back toward recent lows. Meanwhile, technical analysts emphasize that the path forward is obstructed; the metal faces significant resistance at its 50-day moving average of $4,581 and the May 12 lower high of $4,773.

Institutional sentiment remains divided. While some look toward new Federal Reserve Chair Kevin Warsh for signals on future rate policy, analysts at Société Générale maintain a neutral stance. They argue that elevated real yields continue to suppress gold’s appeal as a defensive asset, noting that global oil inventories remain dangerously low. Even with a peace deal, the scarcity of supply means energy markets will likely remain volatile, keeping inflation risks firmly in play for the foreseeable future.