Gold Rebounds Below $4,100

 

Gold (XAU/USD) trimmed its sharp intraday losses after falling to a monthly low during Thursday’s early European session on October 22, 2026. However, the precious metal maintained a bearish short-term outlook, trading below the key $4,100 level.

The US Dollar (USD) remained under selling pressure as recent comments from Federal Reserve (Fed) officials suggested there was little urgency to raise interest rates at the October 27–28 policy meeting. Meanwhile, US Treasury yields extended their retreat from multi-year highs, weighing on the Greenback and providing some support for gold prices.

Gold Price Technical Outlook

The XAU/USD pair maintained a bearish bias below the 200-period Simple Moving Average (SMA) on the four-hour chart. The Moving Average Convergence Divergence (MACD) indicator remained in negative territory, with its line below the signal line, while the Relative Strength Index (RSI) hovered in the mid-30s.

Together, these momentum indicators suggest persistent selling pressure, although gold is approaching oversold conditions.

On the downside, initial support is located around $4,075–$4,065, near the monthly swing low. A sustained break below this zone could trigger additional selling, exposing the intermediate support area at $4,030–$4,025 before the psychological $4,000 threshold comes into focus.

On the upside, the $4,140 area represents the nearest resistance. A decisive move above this level could open the door for another attempt to reclaim $4,200. Sustained strength above $4,200 could push gold toward the 200-period SMA near $4,232. A breakout above this moving average would help ease the current bearish pressure and potentially pave the way for a more meaningful corrective rebound.

Fed Rate Hike Expectations Weigh on Gold

Despite the recent weakness in the US Dollar and Treasury yields, gold continues to face headwinds from expectations of tighter Federal Reserve policy.

US inflation data released last week reinforced market expectations of a potential rate hike. According to the CME Group FedWatch Tool, traders are pricing in approximately a 90% probability that the Fed will raise borrowing costs in December.

Volatile oil prices have also fueled inflation concerns, strengthening the case for further monetary tightening. This outlook remains a headwind for gold, which does not offer interest income. Meanwhile, ongoing geopolitical risks could limit losses in the safe-haven US Dollar, potentially capping further gains in the precious metal.

Middle East Tensions Support the US Dollar

Developments surrounding the Middle East crisis continue to influence market sentiment. Iranian Foreign Minister Abbas Araghchi said Tehran remained open to diplomacy while emphasizing the country's readiness to defend itself. He also expressed limited expectations for progress, arguing that Washington had shown little willingness to reach an understanding.

Separately, The New York Times reported that the United States and Israel had developed plans for a short but intensive military campaign against Iran following the US midterm elections. These geopolitical concerns could underpin demand for the safe-haven US Dollar and weigh on gold's recovery.

US Jobless Claims and Fed Meeting in Focus

Gold's acceptance below the psychological $4,100 level reinforces the risk of further downside in the near term. Traders are now looking to the weekly US Initial Jobless Claims report on Thursday for fresh trading signals, followed by preliminary global Purchasing Managers' Index (PMI) data on Friday.

Nevertheless, the main focus remains on next week's Federal Open Market Committee (FOMC) meeting, which could provide further clues about the Fed's interest rate outlook and the next major direction for gold prices.

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Gold Prices Rebound

 

Gold prices edged higher after recovering from weekly lows near $4,100, but the upside remains limited by a bearish fundamental backdrop. Inflation risks driven by volatile oil prices are reinforcing expectations that the US Federal Reserve (Fed) could tighten monetary policy further. Meanwhile, a modest recovery in the US Dollar from a three-week low is adding pressure on bullion and limiting its recovery potential.

Technical Outlook: Gold Remains Bearish

Gold's failed attempt to break above the 100-period Exponential Moving Average (EMA) on the four-hour chart, followed by a subsequent decline, reinforces the negative technical outlook.

The Moving Average Convergence Divergence (MACD) indicator remains in negative territory, with its latest reading at -4.65. Meanwhile, the Relative Strength Index (RSI) stands at 39.16, indicating weak momentum without yet signaling oversold conditions.

A sustained break below the $4,100 level would strengthen the bearish bias and expose the monthly swing low near $4,066.

Further selling pressure could accelerate losses toward the psychological $4,000 mark, followed by the year-to-date low around $3,943–$3,942, recorded in June.

On the upside, the 100-period EMA near $4,175 is likely to act as the nearest significant resistance. A sustained move above this barrier would be needed to ease the current bearish pressure and open the door to a stronger recovery.

Oil Volatility Supports Fed Rate Hike Bets

Crude oil prices experienced a dramatic intraday reversal on Tuesday, retreating from a more-than-one-month high amid renewed hopes for US-Iran peace negotiations.

An unconfirmed report suggested that Qatar and Pakistan had proposed a compromise plan to Washington and Tehran that could address both sides' demands. However, Bloomberg subsequently reported that a diplomat involved in the negotiations denied reports that an agreement was close.

Iranian state media also reported that Parliament Speaker Mohammad Bagher Ghalibaf told Pakistan's army chief, Asim Munir, that the United States could not earn Iran's trust without meeting previously announced conditions. These reportedly included ending all hostilities and unfreezing Iranian assets, dampening expectations of an imminent diplomatic breakthrough.

Adding to uncertainty, Iran's First Vice President said the country had no choice but to exercise sovereignty over the Strait of Hormuz. The statement heightened concerns about potential disruptions to crude oil supplies and helped oil prices rebound sharply from their weekly lows.

The renewed oil price recovery comes after hotter-than-expected US inflation data released last week, strengthening market expectations of another Federal Reserve rate hike. According to the CME Group FedWatch Tool, traders are pricing in a probability of more than 90% that the US central bank will raise borrowing costs again in December.

Meanwhile, persistent uncertainty surrounding the Middle East crisis is providing some support for the US Dollar as a safe-haven asset. This has become another headwind for gold, contributing to its fourth consecutive day of losses and increasing the risk of a deeper correction.

Fed Outlook: October Hold, December Hike

Analysts at BNY Markets reiterated that they do not expect a rate hike at the Fed's upcoming October meeting, noting that market expectations are broadly aligned with this view. They added that markets are currently pricing in only a 17% probability of a rate increase at the next Federal Open Market Committee (FOMC) meeting.

Instead, BNY considers December the most likely opportunity for the next federal funds rate increase and expects it to be the final hike in the current tightening cycle.

Looking further along the policy curve, BNY noted that the implied federal funds rate for December 2027 is now just 4.64%, suggesting slightly less than 75 basis points of additional tightening. These expectations are also somewhat below the most hawkish levels seen several weeks ago.

Nevertheless, investors may remain cautious about taking aggressive directional positions until clearer signals emerge regarding the Fed's policy trajectory.

Market attention will therefore focus on the two-day FOMC policy meeting scheduled for October 28–29 and the US Personal Consumption Expenditures (PCE) Price Index due on October 29. The PCE index is the Fed's preferred inflation gauge and could provide further clues about the outlook for interest rates.

Monetary policy decisions from other major central banks next week, including the Reserve Bank of New Zealand (RBNZ), Bank of Canada (BoC), European Central Bank (ECB), and Bank of Japan (BoJ), may also influence market sentiment toward non-yielding gold.

Overall, the combination of elevated oil prices, persistent inflation concerns, a potentially hawkish Federal Reserve, and a modestly stronger US Dollar continues to favor gold sellers. Unless XAU/USD breaks decisively above the $4,175 resistance zone, the near-term path of least resistance remains to the downside.

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Gold Prices Slide

 

Gold prices declined toward $4,120 during European trading on Tuesday as recovering US Treasury yields and rising oil prices weighed on the precious metal. Investors are also monitoring upcoming third-quarter earnings reports from major US technology companies, including Meta Platforms, amid growing concerns about AI-related capital spending and its implications for economic growth.

Gold Price Forecast: XAU/USD Faces Bearish Pressure

Spot gold (XAU/USD) traded near $4,120, maintaining a short-term bearish bias as prices remained below the 20-day Exponential Moving Average (EMA) at $4,186.57. The precious metal has retreated from recent highs and is struggling to regain this key technical level, suggesting that selling pressure continues to limit its recovery.

The Relative Strength Index (RSI) stood at 43.66, below the neutral 50 mark. This indicates that bearish momentum remains in place, although gold has not yet entered oversold territory.

On the upside, the 20-day EMA at $4,186.57 represents the nearest resistance. A daily close above this level would help ease downward pressure and potentially open the door for a more sustained recovery toward $4,300.

On the downside, the psychological $4,000 level remains a major support area for gold. A break below this threshold could expose the precious metal to further losses.

US Treasury Yields Recover Ahead of Meta Earnings

The US third-quarter earnings season is underway, with Meta Platforms among the major technology companies scheduled to report its results on Wednesday. Microsoft, Amazon, and Alphabet are expected to release their quarterly earnings next week.

According to Goldman Sachs, Meta is among five major AI hyperscalers expected to increase their combined capital expenditure to approximately $1.2 trillion next year, Reuters reported.

Such substantial investment could support economic growth and make growth-oriented assets more attractive to investors compared with traditional alternatives. However, concerns about the sustainability of AI infrastructure spending have recently weighed on market sentiment and influenced US Treasury yields.

Deutsche Bank analysts noted that growing concerns about AI-related economic growth had triggered a significant flight to safety in fixed-income markets. This shift helped support government bonds as investors reassessed the economic outlook.

The bank highlighted that the 10-year US Treasury yield fell 16.5 basis points last week, reaching 5.07% before edging up 1.5 basis points on Friday. The recent movements reflect changing investor expectations regarding economic growth and the outlook for financial markets.

Although Treasury yields showed signs of recovery on Monday, the 10-year yield was reported down 0.35% near 5.13% at the time of writing. Higher yields can weigh on gold because the precious metal does not offer interest income.

Oil Prices Rise on Middle East Risks

Oil prices have climbed nearly 15% over the past two weeks from a recent low of $86.32. West Texas Intermediate (WTI) crude was trading slightly higher near $98.45 at the time of writing.

Persistent tensions in the Middle East have prompted investors to maintain a substantial geopolitical risk premium in oil prices. Reports that Iran could expand the scope of a potential blockade to include the Bab el-Mandeb Strait and the Suez Canal have raised concerns about disruptions to global energy supplies.

Additional concerns emerged after Mohsen Rezaei, a member of Iran's political and security establishment, warned over the weekend that Tehran had prepared new retaliatory plans in the event of further US-Israeli attacks.

Higher oil prices could complicate the inflation outlook by increasing energy costs. This could also influence Federal Reserve policy expectations and indirectly affect gold prices through changes in Treasury yields and the US dollar.

Federal Reserve Enters Blackout Period

The Federal Reserve has entered its blackout period ahead of its upcoming monetary policy announcement. During this period, Fed officials generally refrain from public comments on monetary policy.

Recent remarks from several policymakers have emphasized the importance of bringing inflation back to the central bank's 2% target. However, officials have not indicated an urgent need for another interest rate increase.

Meanwhile, the CME FedWatch Tool suggests that market participants expect the Fed to leave interest rates unchanged in October, while pricing in the possibility of a rate hike in December.

The combination of Treasury yield movements, oil price volatility, geopolitical tensions, and changing Fed expectations is likely to remain central to gold's near-term direction.

For now, XAU/USD faces a bearish technical outlook while trading below $4,186.57. A sustained break above this resistance could support a recovery toward $4,300, whereas the $4,000 psychological level remains the key downside support to watch.

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