Published: 4 March 2026,06:00
Daily Market Analysis New
*Dollar Index (DXY) records its best two-day rally in a year, as the US-Iran war intensifies and safe-haven demand reaches a fever pitch.
*Gold prices plunge over $250 in a massive technical correction, retreating sharply after hitting a critical Fibonacci resistance level near $5,400.
*Middle East conflict reaches new heights with confirmed Iranian strikes on the US Embassy in Riyadh and drone attacks near the US Consulate in Dubai.
Market Summary:
The “safe-haven” landscape has shifted dramatically in the last 24 hours. While the geopolitical situation is worsening, the market’s reaction has split: the US Dollar is now the undisputed winner, while Gold has suffered a major technical “blow-off” top. Since Saturday, the death toll in Iran has climbed to at least 787 people following continued US-Israeli strikes. In retaliation, Iran has expanded its target list, with the fourth night of attacks including a drone-related fire near the U.S. Consulate in Dubai and strikes on the Fujairah port in the UAE.
The U.S. Dollar Index is experiencing a powerful surge, supported by two main factors. First, the US is seen as a “net energy exporter,” making its currency more resilient to Middle East oil disruptions than the Euro or Yen. Second, the threat of war-driven inflation is forcing U.S. Treasury yields higher. Institutional investors are now pricing in a reality where the Federal Reserve cannot cut rates because skyrocketing oil prices are keeping inflation too high. This “Hawkish” outlook makes the dollar even more attractive to global investors.
Gold’s volatile reversal caught many by surprise this morning. After hitting record highs early in the week, the metal tumbled sharply—falling from the $5,400 area to approximately $5,043. This “tumble” was triggered by a technical correction at a key Fibonacci level, combined with a “liquidity grab” where traders sold gold to cover losses in other crashing markets (like the Dow Jones, which fell 1,000 points). The massive jump in the dollar also made gold too expensive for many international buyers, leading to a wave of profit-taking.The Bottom Line: While the long-term trend for Gold remains resilient due to the unsettled war, the immediate “momentum” has shifted back to the Greenback. Market participants are now in a high-alert “wait-and-see” mode. The focus remains on whether the conflict will permanently close the Strait of Hormuz, which would likely send the Dollar and Oil even higher while leaving Gold to find a new support level amidst the technical chaos.
Technical Analysis
The Dollar Index is currently testing a multi-month high at 99.50, but internal indicators suggest the rally is becoming “stretched.” While the price action remains dominant, the RSI at 73 has officially entered overbought territory, and the MACD histogram is beginning to plateau, signaling a potential divergence.
A successful breakout above 99.50 would clear the path for a psychological test of 100.35, but without a fresh fundamental catalyst, a technical cooling-off period toward the 98.70 support level appears increasingly likely to shake out over-leveraged longs.
Resistance Levels: 99.50, 100.35
Support Levels: 98.70, 97.95
Gold has successfully defended the 5040.00 Fibonacci support level and is now mounting a recovery toward the 5170.00 resistance zone. The technical setup is turning cautiously constructive; the MACD shows a clear reduction in bearish pressure, while the RSI at 43 has plenty of “white space” to climb before hitting overbought levels.
If buyers can flip 5170.00 into support, the next major objective is the 5355.00 peak. Conversely, a failure to clear this immediate hurdle would suggest this was merely a “dead cat bounce,” potentially leading to a double-bottom test at 5040.00.
Resistance Levels: 5170.00, 5355.00
Support Levels: 5040.00, 4910.00
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