Gold Holds Near $4,100 Awaiting Fed Minutes for Direction
Gold prices have slipped back below $4,150 during Wednesday’s Asian trading session, retreating from a brief rebound after hitting a nine-week low near $4,100. The metal remains confined within a two-week range between $4,200 and $4,100, reflecting a tug-of-war between conflicting factors. On one side, diminishing expectations of a Fed rate hike in October, strong central bank demand, and geopolitical concerns are providing some support. China, for instance, increased its gold reserves by 23.02 metric tons in September, bringing its total holdings to 2,409.59 metric tons.
On the other hand, inflation risks tied to energy prices, rising US Treasury yields, and a stronger US Dollar are weighing on gold. Analysts at BNY Markets note that while the market has scaled back bets on an October rate hike, the likelihood of a December hike remains high at around 70%. The Fed’s September meeting minutes, due later in the day, along with Middle East tensions and US crude oil inventories, could provide fresh direction for gold prices.
Technically, gold’s near-term outlook remains bearish, as it trades below key moving averages, including the 50-day, 100-day, and 200-day SMAs. The Relative Strength Index (RSI) suggests mild negative momentum, with no immediate signs of oversold conditions. Immediate resistance is seen at $4,267.61, followed by $4,332.12 and $4,530.95, while support holds around $3,999.07.