NEW YORK — On May 22, gold prices staged a fierce battle around the $3,300-per-ounce mark, keeping investors on edge. Spot gold swung more than $60 throughout the day, ultimately closing down 0.57% at $3,294.70. The heavy trading activity reflected heightened sensitivity to geopolitical tensions and fluctuations in the U.S. dollar.

During Asian hours, gold surged as much as 1.8%, hitting an intraday high of $3,345.80, driven by news reports suggesting Israel might launch military action against Iran’s nuclear facilities. The rising geopolitical uncertainty sparked a wave of safe-haven buying, pushing prices higher. However, as trading moved into the European and U.S. sessions, a stabilizing dollar pressured gold lower. Stronger-than-expected U.S. data—specifically the May flash PMIs for both manufacturing and services—prompted a technical bounce in the dollar, which capped gold’s rally.

Gold briefly dipped to a session low of $3,277.70 before finding support from technical buyers. Traders pointed to $3,288 as a near-term support level, which aligns with the 20-day moving average, while $3,345 marks a key resistance zone. Overall, the tug-of-war around the $3,300 level signals that the market remains uncertain about gold’s next move.

Adding to the uncertainty was ongoing debate in the U.S. Congress over a new round of tax reforms. One version of the proposal—which includes raising the cap on state and local tax deductions—could expand the federal deficit by $3.8 trillion over the next decade if passed, raising concerns about potential monetization of debt. This drew additional safe-haven buying into gold. Data from the CME showed gold open interest on COMEX rose 4.2% for the day, hinting at renewed bullish sentiment.

Looking ahead, investors expect gold to remain reactive to developments in the Middle East and shifts in U.S. policy. Markets will also be watching upcoming U.S. Energy Information Administration (EIA) crude inventory data, along with speeches from several Federal Reserve officials, for further clues on risk appetite.

(Source: Compiled from Kitco Metals and public market data)