Gold (XAU/USD) is trading within a tight range on Thursday, consolidating between $3,360 and $3,400.

These levels have repeatedly served as key short-term support and resistance over recent sessions.

With the United States (US) observing the Juneteenth holiday, lower trading volumes have resulted in subdued price movements, although underlying risks remain pronounced.

Geopolitical tensions persist as significant drivers of Gold prices. Russia has issued a stark warning against potential US military involvement in Iran, describing it as an "extremely dangerous step" with "unpredictable negative consequences."

Meanwhile, Israeli Defense Minister Israel Katz emphasized the need for intensified attacks following recent escalations, underscoring ongoing risks tied to the Israel-Iran conflict.

Katz specifically targeted Iranian Supreme Leader Khamenei, asserting the goal to neutralize nuclear and missile threats.

On the economic front, Gold prices face pressure from renewed US Dollar strength following the Federal Reserve's latest policy update. Although the Fed held interest rates steady at 4.25%–4.50 % on Wednesday, Chair Jerome Powell's unexpectedly cautious commentary suggested that monetary policy might remain tighter than anticipated.

Long-dated US Treasury yields declined, but short-term yields rose, reflecting lingering concerns about inflation.

Source: Fxstreet