Fed Rate Decision May Trigger a Decline in Gold Prices

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Despite heightened tensions in the Middle East providing safe-haven support, gold failed to break through the 3450–3455 resistance zone today and instead pulled back to the 3400–3386 support area.

This decline was mainly driven by two factors:

Iran expressed willingness to resume nuclear talks, easing geopolitical tensions and weakening safe-haven demand.

Growing expectations that the Fed will keep rates unchanged this week strengthened the DXY, reducing gold's appeal.

That said, inflation concerns persist, offering medium-term support to gold. On the technical front, the 3378–3340 consolidation zone may serve as secondary support, while stronger trend support lies in the 3310–3289 range—a level that may only be tested under extreme bearish conditions.

For now, the primary support to watch is 3386–3373, with short-term rebound resistance around 3400–3420.

Trading Suggestion:
Ahead of the Fed’s rate decision tomorrow, consider buying on dips, as today’s decline may lead to a technical rebound. Then reassess the market’s response to key support and resistance levels to determine further action.

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