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Key takeaways

• Gold (XAU/USD) has broken below its 200-day moving average for the first time in three months, increasing the risk of a fresh bearish impulsive decline within its broader medium-term downtrend.
• Rising US Treasury real yields continue to pressure gold prices, with the 10-year real yield staging a major bullish breakout toward multi-month highs, reducing the appeal of non-yielding assets such as gold.
• Technical indicators suggest bearish momentum remains intact below the $4,456 resistance level, with downside risks potentially extending toward $4,320 and the $4,262/$4,250 support zone.

This is a follow-up analysis on the prior report, “Chart alert: Gold (XAU/USD) rally faces roadblock at 20-day and 50-day moving averages”, published on 7 May 2026.

Gold (XAU/USD) has indeed remained lackluster in May and failed to break above its 50-day moving average after a retest of it on 12 May 2026.

Thereafter, the precious yellow metal staged a bearish reaction after a retest on the 50-day moving average for the second time on 12 May 2026 (the first time was on 17 April 2026). It printed an intraday high of $4,774/oz on 12 May 2026 and tumbled by 10% to hit a two-month low of $4,368/oz at this time of writing.

Intermarket and technical factors are suggesting further potential weakness ahead for gold. Let’s unpack them.

Major Bullish Breakout in the US 10-Year Treasury Real Yield

Fig. 1: Medium-term intermarket analysis of 10-year US Treasury yield with Gold as of 28 May 2026 (Source: TradingView).

The 10-year US Treasury real yield (nominal yield minus the 10-year breakeven rate derived from the 10-year Treasury inflation-protected security) has remained resilient on the upside after it managed to find support at its key 200-day moving average (1.85%) since 15 April 2026.

Thereafter, it rallied by 37 basis points to hit almost a one-year high of 2.26% on 20 May 2026 and staged a prior major bullish breakout from a former key descending channel resistance earlier on 15 May 2026 (see Fig. 1).

These observations suggest that the 10-year US Treasury real yield is likely undergoing a potential major uptrend phase (multi-month), with the next medium-term resistance coming in at 2.38% next in the first step.

Gold (XAU/USD) has a significant indirect correlation with the longer-term US Treasury yields, as the precious yellow metal is a non-interest income-bearing asset.

Hence, further upside in the 10-year US Treasury real yield translates into a further potential feedback loop into Gold (XAU/USD).

Let’s focus now on the short-term trajectory (1 to 3 days) of Gold (XAU/USD).

Gold (XAU/USD) – Start of a New Minor Bearish Impulsive Down Move Within Medium-Term Downtrend

Fig. 2: Gold (XAU/USD) medium-term trend as of 28 May 2026 (TradingView).

Fig. 3: Gold (XAU/USD) minor trend as of 28 May 2026 (TradingView).

Trend bias: Bearish bias below 4,456 key short-term pivotal resistance (see Fig. 3).

Supports: 4,320 (24 March 2026 low), 4,262/250 (Fibonacci extension & 23 March 2026 congestion), 4,187/167 (Fibonacci extension & 23 March 2026 swing low area).

Next resistances: 4,500 (former range support of 21/22 May 2026), 4,580 (also 20-day MA), 4,645 (also 50-day MA)

Key Elements to Support the Short-Term Bearish Bias on Gold (XAU/USD)

• Price actions continue to oscillate within a medium-term descending channel in place since its current all-time high printed on 29 January 2026 (see Fig. 2).
• Price action is now breaking below the key 200-day moving average, the first time in three months since a retest of it on 23 March 2026.
• The hourly RSI momentum indicator is in an oversold region (below the 30 level), but without any bullish divergence signal, suggesting near-term bearish momentum is likely still intact.

The “imminent Iran peace deal” narrative collapsed violently across markets today. Just days ago, traders were aggressively pricing a rapid diplomatic breakthrough that would fully reopen the Strait of Hormuz, crush oil prices, and ease global inflation fears. That optimism has now evaporated. Fresh U.S. strikes, renewed regional military threats, and rising skepticism toward the negotiations triggered a sharp reversal across markets, with oil and Dollar surging together while Gold and Silver plunged under heavy liquidation pressure.

The turning point came after US President Donald Trump then poured further cold water on the diplomatic narrative by saying he was “not satisfied” with the current trajectory of talks. Then there were reports that U.S. forces launched fresh overnight strikes targeting Iranian military infrastructure following drone threats around Hormuz.

More importantly, Kuwait’s activation of air defenses against incoming missile and drone threats shattered the market’s assumption that the conflict was becoming geographically contained. Traders are now being forced to confront the possibility that the crisis is again spreading into a broader Gulf regional flashpoint involving critical U.S.-aligned infrastructure.

The key macro shift is that markets are once again repricing inflation shock risk rather than geopolitical de-escalation. Brent oil’s rebound above $95 is feeding directly into expectations for higher inflation, firmer Treasury yields, and renewed Dollar strength. That combination is once again proving particularly toxic for non-yielding precious metals.

Technically, Gold’s earlier recovery attempt stalled at 4,580.33 after rejection by 55 4H EMA, and the subsequent break below 4,453.47 suggests downside momentum is accelerating again.

Risk will now stay on the downside as long as 4,580.33 resistance holds. Sustained trading below 61.8% retracement of 4,098.45 to 4,889.24 at 4,400.53 could trigger downside acceleration to retest 4,098.45, or in short, 4,000 major psychological level.

Silver’s technical picture is similarly fragile after its rebound from 73.08 failed at 55 4H EMA, resuming the broader decline from 89.37. The metal is now approaching the crucial 70 psychological zone, which could still attract structural dip-buying because of Silver’s heavy industrial exposure to green technology and electronics demand.

But if the combination of rising oil, stronger Dollar, and higher yields forces Silver decisively below 70 (with 61.8% retracement of 70.97 to 89.37 at 71.81), liquidation pressure could intensify rapidly as stop-loss selling accelerates toward the next major support zone around around 60.97, or even the 60 psychological level.

Key takeaways

• Global equities climbed to fresh record highs as the AI infrastructure supercycle continued to dominate market sentiment, with hyperscalers projected to spend up to $1 trillion on AI capex by 2027.
• Markets remain highly sensitive to conflicting US-Iran peace deal headlines, driving sharp volatility in oil prices, bond yields, and broader risk sentiment across global asset classes.
• Sticky inflation and increasingly hawkish central bank rhetoric have reinforced expectations of prolonged restrictive monetary policy, with traders now pricing higher odds of Fed and ECB rate hikes.
• Chart of the day: Nikkei 225 at risk of corrective pull-back below 65,665 key short-term resistance.

Top macro headlines

• World stocks advance to record heights: Global equity indices, including the S&P 500, Nasdaq, and MSCI All Country index, eked out fresh record highs. The momentum remains strongly supported by an unyielding AI infrastructure supercycle that continues to overrule broader macroeconomic headwinds.
• US-Iran peace progress met with extreme skepticism: Volatility continues to rock the energy sector amid conflicting headlines regarding a breakthrough in the Middle East. While Iranian state media cited an unofficial memorandum of understanding to reopen the Strait of Hormuz within a month, the White House forcefully rejected the report, calling it a "complete fabrication."
• Trillion-dollar tech IPO pipeline expands: Speculation surrounding Elon Musk's public market footprint is heating up as SpaceX prepares to debut on the Nasdaq on June 12, targeting a valuation between $1.75 trillion and $2 trillion. Rumors are intensifying that Musk may eventually move to merge Tesla and SpaceX/xAI to build a unified AI giant. Concurrently, OpenAI and Anthropic continue to pursue substantial private and public funding sources.
• Central banks implement hawkish directives: Global monetary policy cycles are shifting aggressively toward headwinds. Following recent rate hikes in Australia and Norway, the Reserve Bank of New Zealand kept rates on hold in a highly contested split decision that points to imminent hikes. Simultaneously, European Central Bank officials delivered strong hawkish guidance, emphasizing that rate hikes should proceed regardless of Middle East peace outcomes. The short-term interest rate swaps market is now showing increasing odds of a 25-basis-point hike from the ECB in June.

Key macro themes

• AI Capex Supercycle vs. Dotcom Bubble Parallels: Cloud hyperscalers are projected to pour over $850 billion into AI infrastructure this year and up to $1 trillion in 2027. While the massive capital expenditures are absorbing enormous amounts of operational cash flow and driving up corporate debt, analysts from Goldman Sachs emphasize that a market crash is not imminent, as these tech giants are delivering concrete, strong earnings growth compared to the speculative late-1990s dotcom mania.
• The repricing of Fed trajectory before key PCE: Heading into Thursday's highly anticipated April PCE report, the first major inflation data of the new Fed Chair Kevin Warsh era at the Fed, economists expect headline annual PCE to accelerate to 3.8% y/y and core annual PCE to jump to 3.3% y/y. Sticky inflation and the ongoing war shock have completely erased 2026 rate cut hopes, with Fed funds futures traders now pricing in a 60% probability of an active Fed interest rate hike by year-end.
• The sovereign yield burden & corporate debt safe havens: Due to sticky inflation, deteriorating public finances in Washington, and massive upcoming Treasury coupon supply, investor sentiment toward U.S. sovereign debt has soured. Consequently, fund managers are increasingly eschewing Treasuries to flock into top-tier, blue-chip U.S. corporate debt, as corporate America's balance sheets increasingly look more sound than Washington's debt.

Global market impact (last 24 hours)

Equities: Wall Street was mixed but steady; the Dow Jones and Russell 2000 notched new record highs, while the S&P 500 and Nasdaq finished basically flat. Gains were led by consumer discretionary (+1.9%), with United Airlines gaining 6%, while software and chip names consolidated, with Qualcomm dropping 6%, and Nvidia slipping by 1%. Europe closed flat, and the UK FTSE gained 0.1%.

Fixed Income: U.S. Treasury yields eased slightly by 1-2 basis points. A heavy multi-billion dollar 5-year sovereign note auction registered acceptable investor demand ahead of top-tier PCE inflation data due later today.

FX: The U.S. Dollar Index (DXY) remained mostly flat. The New Zealand Dollar (Kiwi) skyrocketed by 1.0% to emerge as the largest G10 mover following the hawkish RBNZ split decision. The Japanese Yen slumped to a fresh 4-week low toward 159.50 per USD, entering acute verbal and physical intervention zones.

Commodities: Crude oil prices tumbled by 4.0%, sliding back below the critical $100/barrel handle as energy traders tentatively priced in the state-television peace rumors. Precious metals remained under severe pressure from higher global yield tracking; spot gold slipped further to trade near a fresh 2-month low at $4,456/oz, just above its 200-day moving average ($4,394/oz).

Asia Pacific impact

• South Korean and regional indices explode: South Korea's benchmark KOSPI spearheaded global equity gains, skyrocketing 3.0% to print a major record high on Wednesday, 27 May. The explosive rally is heavily driven by its twin memory chip giants, Samsung Electronics (+158% YTD) and SK Hynix (+258% YTD), both of which have been vaulted into the exclusive $1-trillion-valuation club due to insatiable AI infrastructure demand.
• Japan eyeing June hike amid slumping currency: Despite massive sovereign bond yield volatility, reports reveal the Bank of Japan is actively eyeing a June interest rate hike. This comes as the Japanese yen's purchasing power sinks to fresh lows under the weight of expensive energy imports, leaving it tracking as one of the world's weakest major currencies. Concurrently, SoftBank is pulling in 30 leading Japanese manufacturers to back a major homegrown AI industrial data venture.
• India falters and capital exits accelerate: In stark contrast to its East Asian peers, India's benchmark equity indices are faltering as foreign institutional investors dump domestic shares at a record-breaking pace. Millions of retail investors are shifting capital out of the country into foreign markets (up 57% y/y) due to a complete lack of AI exposure at home, a rapidly depreciating rupee, and consecutive fuel price hikes stoking structural inflation.

Top 3 events to watch today

1. US PCE Core Inflation (Apr) - 8:30 pm SGT (consensus: 3.3% y/y, Mar: 3.2% y/y) Impact: All asset classes
2. US Weekly Initial Jobless Claims - 8:30 pm SGT Impact: USD, short-term US Treasuries, US stock indices
3. US-Iran peace deal news flows Impact: All asset classes

Chart of the Day - Nikkei 225 at Risk of Minor Setback

Fig. 1: Japan 225 CFD minor trend as of 28 May 2026 (Source: TradingView).

The price actions of the Japan 225 CFD (a proxy of the Nikkei 225 futures) have hit a short-term inflection/resistance level of 66,190/558 on Wednesday, 27 May 2026, after breaching above the upper boundary of a major ascending channel running from the 7 April 2026 low.

In addition, the hourly RSI momentum indicator flashed a prior bearish divergence condition at its overbought level before staging a bearish breakdown below its 50 level.

These observations suggest an impending minor corrective pull-back/setback. Watch the 65,665 key short-term pivotal resistance. A break below 64,620 near-term support (downside trigger level) may expose the next intermediate supports at 63,788/270 and 62,510 (also close to the 20-day moving average).

However, a clearance above 65,665 invalidates the bearish scenario for a continuation of the bullish impulsive upmove sequence to retest the current all-time high area of 66,190/558 before potentially setting sight on the next intermediate resistance at 67,047 (Fibonacci extension).

Key Highlights

• Gold started a fresh decline below the $4,550 support.
• A major bearish trend line is forming with resistance at $4,525 on the 4-hour chart.
• WTI Crude Oil extended losses and traded below $95.
• EUR/USD started a minor recovery wave above 1.1620.

Gold Price Technical Analysis

Gold failed to surpass $4,650 and trimmed gains against the US Dollar. The price dipped below $4,600 and $4,550 to enter a bearish zone.

The 4-hour chart of XAU/USD indicates that the price even declined below $4,500, the 100 Simple Moving Average (red, 4 hours), and the 200 Simple Moving Average (green, 4 hours). A low was formed at $4,401, and the price is now consolidating losses.

On the upside, immediate resistance is $4,475. The next major resistance sits near $4,500 and the 50% Fib retracement level of the downward move from the $4,600 swing high to the $4,401 low.

The main resistance could be near $4,525 and the 61.8% Fib retracement level. There is also a major bearish trend line forming with resistance at $4,525. A clear move above $4,525 could open the doors for more upside. In the stated case, the bulls could aim for a move toward $4,600 or even $4,620.

If there is another decline, Gold might find bids near the $4,400 level. The first major support sits at $4,365. The next support could be $4,320, below which the price might slide to $4,300. The main support sits at $4,200. Any more losses might call for a test of $4,065 or even $4,000 in the coming days.

Looking at WTI Crude Oil, the price started a fresh decline and there are chances of more losses below the $90 zone.

Economic Releases to Watch Today

• US Initial Jobless Claims - Forecast 243K, versus 244K previous.
• US Gross Domestic Product Q1 2026 (Preliminary) – Forecast 1.3% versus previous 2.1%.

Federal Reserve Vice Chair Philip Jefferson said the current stance of US monetary policy remains appropriate despite ongoing upside risks to inflation tied to the Middle East conflict and energy disruptions. Speaking at the Bank of Japan-IMES Conference in Tokyo, Jefferson said the current federal funds rate range leaves the Fed “well positioned to respond to economic developments based on the incoming data, the evolving outlook, and the balance of risks.”

Jefferson acknowledged that inflation pressures are expected to ease later this year, but warned that risks to the outlook remain skewed higher. He noted that while the United States is a major energy producer, it is “not fully insulated from the energy disruptions the war has created.”

At the same time, Jefferson avoided signaling any predetermined move for the June FOMC meeting, stressing that he had “not prejudged the next meeting.”

He described the US economy as still delivering a “solid performance,” while characterizing the labor market as stable with low hiring and firing. However, Jefferson added that job-market risks are “tilted to the downside,” underscoring the delicate balancing act facing the Fed as policymakers weigh persistent inflation pressures against softer growth risks.

Federal Reserve Governor Lisa Cook warned that inflation risks are increasingly tilted to the upside, even though she currently favors keeping interest rates unchanged. Speaking at a policy forum at Stanford University, Cook said the Fed should continue holding rates steady “from a risk-management perspective,” but stressed that policymakers must remain prepared to tighten further if inflation fails to ease in a timely manner.

Cook acknowledged that inflation is “clearly moving in the wrong direction,” citing tariffs, the Iran conflict, rising oil prices, and surging AI-related investment as major drivers of renewed price pressures. She pointed specifically to rising energy and fertilizer costs, as well as stronger demand for chips, software, and construction workers linked to the rapid expansion of AI data centers.

Importantly, Cook warned that after more than five years of inflation running above the Fed’s 2% target, the danger of inflation expectations becoming embedded is increasing. “The risks remain tilted toward higher inflation,” she said, adding: “I am prepared to raise rates, if the expected disinflation does not appear in a timely manner.” While she still expects inflation to moderate without additional tightening, her remarks reinforce a broader shift among Fed officials toward greater caution about persistent second-round inflation pressures.

Federal Reserve Bank of Minneapolis President Neel Kashkari warned that inflation remains the Fed’s primary concern despite growing uncertainty surrounding the global economy and Middle East conflict. Speaking at the Bank of Japan-IMES Conference in Tokyo, Kashkari said inflation in the United States is still “much too high,” while the labor market remains in “decent shape.”

Kashkari emphasized that the Fed must continue taking a “balanced approach” toward its dual mandate, but acknowledged that inflation persistence is becoming increasingly worrying after more than five years of elevated price pressures. “The longer inflation remains elevated, the greater the risk that inflation expectations become unanchored and move higher,” he warned. Kashkari added that if inflation expectations were to drift higher, policymakers “would have to respond even more aggressively”.

The Minneapolis Fed President also pointed directly to the Iran conflict as an important inflation driver, alongside the pandemic, tariffs, and the war in Ukraine. He said rising energy and fertilizer prices are now feeding broader inflation pressures across the global economy. “One of the things I’m going to be looking for is, when do we see energy prices affecting the broader economy,” Kashkari said, highlighting growing concern inside the Fed about second-round inflation effects spreading beyond oil markets alone.

European Central Bank Chief Economist Philip Lane warned that the inflation impact from the Middle East conflict is likely to persist even if a quick diplomatic resolution is reached. Speaking at a conference hosted by the Bank of Japan and its think tank in Tokyo, Lane said policymakers are concerned that energy-driven price pressures may continue feeding through the broader economy long after the initial oil shock fades.

“Even if the initial energy shock starts to reverse, the second round effect will be with us for a while,” Lane said. He argued that the conflict could leave lasting structural effects on supply chains and global energy strategy, warning that “even if Iran war sees resolution, prolonged conflict could prompt shifts in optimal diversification strategy.”

Lane’s remarks add to increasingly hawkish messaging from senior European Central Bank officials this week as markets prepare for a likely June rate hike. Policymakers are becoming more focused on preventing higher energy costs from feeding into wages, pricing behavior, and broader inflation expectations across the Eurozone economy. The comments also suggest that even a reopening of the Strait of Hormuz may not quickly reverse the inflation pressures already embedded into Europe’s economic outlook.

Global financial markets are on edge as traders wait for clear details about the new US-Iran peace plan.

After two months of intense tension and repeated ceasefire extensions, a concrete framework is finally being discussed.

Both sides know what is at stake: the US wants the Strait of Hormuz reopened without conditions and Iran’s nuclear program dismantled, while Iran wants a full regional ceasefire and a withdrawal of US troops.

The big question for markets now is whether negotiators can bring some still-contradicting demands together in the next 60 days.

Even with uncertainty still in the air, the current situation is giving strong support to risk assets.

The fact that tensions are not turning into a wider war is a major positive change. This relief has pushed the tech-focused Nasdaq to new record highs above 30,000 this morning, up 4% since last week.

The Dow Jones Industrial Average also broke records on Monday’s holiday and is trying to move higher, though today’s trading has been slower and steadier.

This particularly reflects the large change seen in crude oil prices, down just shy of 10% since the weekly open.

Daily FX Performance (15:56), May 27, 2026 – Courtesy of Finviz.

Still, there is some caution in the market because the White House has not shown much excitement about the final details of the deal.

President Trump made it clear that Iran will not get immediate sanctions relief for giving up its highly enriched uranium.

This firm position shows that, even though there is a Memorandum of Understanding, reaching a full treaty remains very complicated and faces many diplomatic challenges.

Cross-Asset Daily Performance, May 27, 2026 – Source: TradingView.

Even if the risk of re-escalation has eased, many details are still unclear and traders are turning their attention back to economic data while awaiting further headlines.

With few major events early this week, big investors are waiting for tomorrow’s important Core PCE report.

This key inflation number will show if the recent oil-driven supply shocks have hurt the US economy more than expected, which could make things harder for the Federal Reserve’s next moves (the next FOMC meeting is on June 17).

These are my final pieces on MarketPulse, so thank you to everyone who enjoyed the posts over the past year. I wish you success in the world of trading and a long life in markets.

With time, resistance and resilience, things will fall in order.

Don't forget to follow me on X, send me messages for any questions, and you can check out my website if you want to stay in contact.

Safe trades and keep your eyes on the news!

Nikkei Futures (NKD) continues to demonstrate remarkable strength as it extends into new all‑time highs, reinforcing the bullish sequence that began from the March 23, 2026 low. This upward momentum favors additional gains in the near term. From the March 23 low, wave 1 concluded at 63,880, followed by a corrective pullback in wave 2 that ended at 59,352. The internal subdivision of wave 2 unfolded as a zigzag, a common corrective structure, before the Index resumed higher. The decisive break above the wave 1 peak confirmed that wave 3 had begun, signaling continuation of the impulsive advance.

From wave 2, the initial leg wave (i) ended at 62,075, while the subsequent pullback in wave (ii) found support at 61,040. The rally extended further, with wave (iii) reaching 65,695, before a modest dip in wave (iv) concluded at 64,650. The final leg, wave (v), advanced to 66,520, completing wave ((i)) of a higher degree. At present, a corrective phase in wave ((ii)) is unfolding, designed to retrace the cycle from the May 20, 2026 low. This correction is expected to provide a healthy consolidation before the broader rally resumes.

In the near term, as long as the pivotal support at 59,352 remains intact, the pullback should ultimately find support within the typical 3, 7, or 11 swing sequence. Consequently, the broader outlook continues to favor further upside once the current consolidation completes, maintaining the bullish trajectory established since March.

Nikkei Futures (NKD) 60-Minute Elliott Wave Chart

NKD_F Elliott Wave Video:

https://www.youtube.com/watch?v=mffic6woNVU