Gold hovers near $4,050 amid uncertainty
Gold (XAU/USD) remains under pressure in Monday’s Asian session, trading just below the $4,050 mark with modest intraday losses of 0.50%. Despite a softer US Dollar and rising expectations of a Federal Reserve rate cut in December, the precious metal fails to attract strong buying interest as broader risk sentiment favors equities.
New York Fed President John Williams described current policy as “modestly restrictive” and suggested room for rate cuts in the near term. Traders responded quickly, pricing in a 67% chance of a rate cut in December. However, other Fed officials, including Dallas Fed President Lorie Logan, maintained a hawkish stance, calling for rates to remain unchanged. This divergence has helped the US Dollar retain its strength near multi-month highs, exerting downward pressure on gold.
Geopolitical risks continue to simmer. Ukraine launched a major drone strike on a power station in Russia’s Moscow region, while Russia claimed to have captured three additional villages in eastern Ukraine. Meanwhile, the President of the United States has given Ukraine until November 27 to approve a 28-point peace proposal aimed at ending the nearly four-year war. Ukraine is reportedly seeking revisions to the plan, which includes painful concessions and acceptance of some Russian demands. These developments sustain geopolitical uncertainty, offering some support to gold’s safe-haven appeal.
This week’s US economic docket is packed, starting with the delayed release of the Producer Price Index (PPI), Retail Sales, and Consumer Confidence Index on Tuesday. Wednesday will bring preliminary Q3 GDP and the Personal Consumption Expenditure (PCE) Price Index—key indicators that could shape expectations for future Fed policy and influence USD dynamics.
Gold is currently defending a confluence support near $4,030, which aligns with an upward-sloping trendline from late October and the 200-period EMA on the 4-hour chart. A decisive break below this level could expose the $4,000 psychological mark and last week’s low near $3,968–3,967. Further downside targets include $3,931 and $3,886.
On the upside, immediate resistance lies at $4,080, followed by $4,100. A sustained move above these levels could open the path toward $4,152–4,155 and potentially the $4,200 round figure.
Summary:Gold remains subdued near $4,050 despite softer USD and rising Fed rate cut expectations. Mixed Fed signals, geopolitical risks, and a busy economic calendar are shaping sentiment. Traders are watching the $4,030 support and $4,080 resistance as key pivot levels in the short term.