Gold prices rose following reports that the International Energy Agency (IEA) is proposing the largest oil reserve release in history to mitigate the supply deficit caused by the war in the Middle East.

The gold price exceeded $5,200 per ounce, gaining 1% in the previous session. The IEA's proposal, reported in the media, involves releasing more than 182 million barrels drawn from reserves after the start of Russia's military operation in Ukraine in 2022. Against this backdrop, oil prices have lost their earlier gains, and the U.S. dollar fell by 0.1%. As noted, gold has increased in price.

As the U.S.-Israeli conflict in Iran continues to escalate and investors analyze conflicting statements from U.S. officials, demand for gold is gradually returning. Just recently, the White House stated that the U.S. did not escort an oil tanker through the Strait of Hormuz; however, prior to that, Energy Secretary Chris Wright posted that the tanker did indeed transit the strait. On Monday, Trump stated that the war is coming to an end, but news of a possible ground operation by the U.S. in Iran emerged just last night.

All of this has heightened concerns about inflation, which in turn has lowered expectations regarding the possibility of interest rate cuts by the Federal Reserve and other central banks, thereby restoring demand for gold.

Since the beginning of the war, the volume of gold held in exchange-traded funds (ETFs) has decreased slightly. According to last week's data, total holdings fell by nearly 30 tons, marking the largest weekly decline in over two years.

Regarding the current technical picture of gold, buyers need to overcome the nearest resistance at $5,223. This will enable them to target $5,317, above which it will be quite challenging to break through. The furthest target will be around $5,417. Should gold prices decline, bears will attempt to gain control over $5,137. If this is achieved, breaking this range will deliver a serious blow to the bulls' positions, potentially pushing gold down to a low of $5,057 with the prospect of reaching $4,975.