Gold stalls below $4,100 resistance level
Gold (XAU/USD) holds modest intraday gains during the first half of the European session but lacks strong follow-through buying and remains capped below the $4,100 level. The United States Dollar (USD) maintains its recent strength near a one-week high, supported by reduced expectations for a December rate cut by the Federal Reserve. This acts as a headwind for the non-yielding yellow metal.
However, the upside for the USD is limited amid concerns about the United States economy. Traders remain cautious and are waiting for clearer signals on the Fed’s rate-cut trajectory before making fresh directional bets on gold. As a result, market attention is focused on the release of the FOMC minutes later today and the delayed Nonfarm Payrolls (NFP) report for September, due Thursday.
Investor sentiment remains fragile due to weakening economic momentum, exacerbated by the longest-ever United States government shutdown. This continues to support safe-haven demand for gold during the Asian session on Wednesday.
Meanwhile, geopolitical tensions persist. Ukraine’s military reported striking targets inside Russia using United States-supplied ATACMS missiles. Ukrainian President Volodymyr Zelenskiy is expected to travel to Turkey to revive stalled peace talks with Russia. A United States special envoy, Steve Witkoff, is set to join the discussions, although Kremlin spokesman Dmitry Peskov confirmed that no Russian delegates will attend. These developments keep geopolitical risks elevated and lend additional support to gold.
The United States Dollar struggles to attract meaningful buying interest, though it remains firm near recent highs amid less dovish Fed expectations. Several Fed officials have recently signaled caution regarding further monetary easing. Fed Vice Chair Philip Jefferson emphasized the need for a slow and measured approach, while Fed Governor Christopher Waller continued to advocate for rate cuts due to labor market concerns.
The United States Labor Department reported that continuing unemployment claims rose to 1.957 million for the week ending October 18, suggesting elevated unemployment levels. This makes Thursday’s delayed NFP report a key event, alongside today’s FOMC minutes, in shaping expectations for the Fed’s policy path and influencing both the USD and gold prices.
On Tuesday, gold found support near the 200-period Exponential Moving Average (EMA) on the 4-hour chart and rebounded. However, mixed oscillators on the same chart suggest caution before positioning for further upside. The $4,100 level remains a key hurdle. A decisive break above it could trigger short-covering and lift gold toward the $4,152–$4,155 zone, with potential to reach $4,200.
On the downside, the $4,037–$4,036 area offers initial support, followed by the 200-period EMA near $4,000. A break below this could expose gold to further declines toward $3,931 and eventually $3,900, with the late October swing low around $3,886 as a deeper target.