Fed Hike Odds Soar, Gold Sinks to Seven-Week Low

Gold prices touched their lowest level in seven weeks on Tuesday as investors increasingly bet that the Federal Reserve will raise interest rates again in October. The odds of a Fed hike now stand at around 70%, up from 57.6% last week.

The US 10-year Treasury yield climbed to 5.27% and the dollar strengthened, making it more expensive for investors to hold gold, which doesn't generate yields.

Gold traders are advised to sell their XAU/USD holdings while Fed-hike odds remain high, with $4,100 identified as a key support level. A break below this could lead to a further drop to $4,000.

The next direction for gold may depend on US data releases this week, including job openings, ADP employment figures, and the PCE inflation gauge.