Gold may rise to $4500 in the short term if oil prices stabilize at lower prices.

Gold price prediction today:Instead of chasing the rally, buying the dips may work as a better strategy for gold right now, says Praveen Singh, Head Currencies and Commodities, Mirae Asset ShareKhan.

Boosted by dovish FOMC, possibility of a Hormuz deal and disappointing US nonfarm payroll report for July, spot gold staged a huge rally in the week ending August 7.

The metal broke free of its seven-week-old consolidation range of $3950-$4200 to close with a weekly gain of 7.31% at $4342 -- its largest weekly gain since January.

The yellow metal has been supported by China extending its gold buying spree, too.

At the time of writing this article on the night of August 10, the shiny metal was trading steady at $4345.

Geopolitics and oil:

Iran and Oman are said to be close to a deal that will lead to a partial reopening of the Strait of Hormuz. However, in an unexpected twist, Iran has tied reopening of the Strait of Hormuz to US concessions. The National Security Council has laid out six conditions for Hormuz to reopen. These conditions include the US ending its threats to Iran; halting military action against Iran and its regional allies; withdrawing its forces involved in blockading Iran; reparation for damage caused in the conflict; and lifting sanctions and unfreezing Iranian assets.

Iran's Supreme Leader Mojtaba Khamenei appointed Major General Mohsen Rezaee, his former senior military adviser, as the new secretary of the Supreme National Security Council (SNSC) on August 9. He replaced Mohammad-Bagher Zolghadr. Rezaee is a longtime advocate for full Iranian control over the Strait

The Wall Street Journal reported Sunday that the US President Trump may declare victory in the war if the Strait of Hormuz is opened; thus, he may not pursue a nuclear deal with Iran. However, complications arising out of Iran's new demands for opening the Strait may affect this possibility.

Oil prices, which fell nearly 9% last week, jumped Monday on Iran demanding concessions from the US. At the time of writing this article, Brent Oil futures were trading with a gain of nearly 3% at $86.07.

Data roundup:

The US nonfarm payroll report for July, which was released on July 7, showed that the job market is still not out of the woods. Nonfarm payrolls unexpectedly declined by 23K Vs the estimate of +80K. Two-month net revision of -103K pushed the 3-month average nonfarm payrolls sharply down from 111K to 20K. Average earnings rose 0.1% m-o-m Vs the forecast of 0.3% and prior 0.3%. On a y-o-y basis, earnings fell from 3.5% to 3.2% (forecast 3.5%), lowest since May 2021. The labour force participation rate fell from 61.6% to 61.4%. Unemployment rate edging lower from 4.2% to 4.1% was a saving grace, though.

Government education jobs dropping by 50000 affected the report; however, even after accounting for this loss, the report was weak.

Chinaâs inflation report released on August 9 showed that oil-led inflation impact may be fading. CPI edged lower from 1% m-o-m in June to 0.5% y-o-y in July (forecast 0.80%) as PPI also cooled from 4.5% y-o-y in June to 3.9% in July Vs the forecast of 3.9%.

Japan's BoP current account adjusted fell from 3064 billion Yen in June to 1396 billion Yen in July as against the estimate of 2514 billion Yen.

Dollar Index and yields:

The US Dollar Index, hurt by the job report, closed with a loss of 0.35% at 99.56 on August 7. The Index, extending its decline to the second straight week, fell 0.35% for the week as lower oil prices dim the prospects of a Fed rate hike.

Two-year US yields at 4.20% were down nearly 2% for the week, while ten-year yields fell 1.90% to 4.64%.

At the time of writing this article on Monday, the Dollar Index at 99.72 was up 0.20% for the day as yields hardened amid firmer oil prices.

Two-year yields at 4.23% were up 3 bps, while ten-year yields at 4.68 were up 4 bps.

Fed rate hike probability:

Probability of the Fed hiking rate by December has edged lower from 85% seen a month earlier to 79%.

ETF holdings and COMEX inventory:

As of August 7, total known global gold ETF holdings stood at 96.94 MOz as holdings continue to recover from the cycle low of 96.16 MOz reached on July 20. However, ETF holdings are still down 1.99 Moz/62 tons YTD (2%) as investors have liquidated 3.94 Moz/123 tons (3.82%) gold from their ETF holdings since the beginning of the Iran war on February 28.

Registered COMEX gold inventory stands at 14.19 MOz, down 41.48% from the cycle-high of 24.25 MOz seen in April 2025.

CFTC positioning:

In the week ending August 4, hedge fund managers increased their bullish gold bets by 12,070 net-long positions to 132,398, according to weekly CFTC data on futures and options. The net-long position was the most bullish in more than six month as long-only positions rose 5,164 lots to 141,820 - the highest in more than six months, while short-only positions fell 6,906 lots to 9,422- the lowest in more than 18 months.

Chinaâs central bank supporting gold:

The People's Bank of China has been moving some of its gold reserves from London to Hong Kong over the past few months as it intends to make Hong Kong a major bullion-trading hub. It is also geared towards establishing a gold clearing system that was launched on a trial basis in July.

PBoC added gold to its gold reserves for the twenty-first straight month last month as its holdings rose by 640,000 ounces, or about 20 tons, in July -- the biggest increase in holdings since October 2023

Upcoming data:

Major US data to be released this week include July CPI (August 12), July PPI (August 13), July retail sales advance (August 13) and August preliminary University of Michigan Sentiment Index along with inflation expectations.

Out of Europe, Eurozone Q2 GDP, 2Q employment (August 14) and UK's 2Q GDP will be in focus of investors.

Upcoming events:

New York Fed will release its household debt and credit report for Q2 on August 11.

Investors will also parse speeches of Fed officials Bowman, Barkin and Hammack.

Gold Price Outlook:

Weak US nonfarm payroll report means the Fed will need to account for both job market dynamics and inflationary concerns in its monetary policy framework. Relentless gold buying by China is quite positive for the yellow metal.

Gold prices may not be that much sensitive to higher oil prices as has been the case in the last few months unless oil surges sharply higher. However, as the Middle East situation remains volatile, gains in gold could be limited unless oil falls. Buying the dips is preferred over chasing the rally.

Gold may rise to $4500 in the short term if oil prices stabilize at lower prices. Interim resistance is seen at $4390-$4400. Support is at $4300/$4200-$4200.

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