Gold has shown remarkable stability in recent trading sessions, gaining over 5.0% since the beginning of last week. This recovery has been sustained despite major economic and political events, including the U.S. midterm elections, a sharp selloff in U.S. equities, and the release of the latest Non-Farm Payrolls (NFP) report. The metal's resilience suggests it may be regaining its appeal as a safe-haven asset amid rising market uncertainty.
The U.S. midterm elections delivered a Democratic victory, sparking concerns about stricter regulation in sectors like artificial intelligence. This contributed to a wave of selling pressure in U.S. equities and pushed the Fear & Greed Index into extreme fear territory. The NFP report showed 165,000 jobs created in October, reinforcing expectations of a more aggressive Federal Reserve policy into year-end. Despite these developments, gold has maintained stable performance and shown signs of recovering demand.
Futures market activity reflects this trend, with trading volume exceeding 220,000 contracts during the final days of last week. Open Interest, which tracks the total number of outstanding positions, moved above 400,000 contracts, signaling strong participation and stabilizing demand. This consistent recovery in buying activity had not been observed for several weeks and suggests gold may be regaining part of its traditional safe-haven appeal.
The upcoming release of the latest U.S. Consumer Price Index (CPI) inflation data could be critical in determining whether the recent buying momentum can be maintained. Markets expect annual inflation to rise to around 3.9%, up from the previous 3.7% reading. The data could influence Treasury yields, one of gold's main competing markets, and shape expectations for future Federal Reserve policy. The 10-year U.S. Treasury yield has once again moved below the 5.00% area, coinciding with a relatively consistent improvement in confidence around gold.
Technically, bullish momentum is beginning to gain relevance. Although a major long-term bearish trendline has dominated gold's daily chart, the recent recovery has started to reduce seller dominance. Key levels to watch include $4,200 as an important upside barrier, $4,000 as a near-term barrier, and $3,885 as critical support. The RSI and MACD indicators suggest a relatively balanced environment, with a dominant directional bias yet to emerge.