Gold Waits on Fed Meeting as War Tensions Continue

Gold prices held steady near $4,050 on Friday, but investors remain cautious ahead of next week's Federal Reserve meeting. The precious metal had dropped sharply on Thursday, but a combination of lower oil prices and easing Treasury yields helped stabilize it.

The US dollar index slipped 0.04% to 101.48, but remained up 0.7% for the week, its strongest weekly gain in five weeks. Traders are pricing a 35.8% chance of a rate hike at next week's meeting, up from 12.8% a week ago.

Despite some relief from lower crude prices, gold still faces challenges, including the ongoing war between Iran and the US-backed forces. The conflict has disrupted Hormuz traffic and put upward pressure on oil prices.

Gold has fallen about 23% since the start of the war in late February. To shift momentum to the upside, gold needs to break a long-term pattern of lower tops and move above $4,072.40, which is seen as a pivot zone.