Gold (XAU/USD) has recovered from an early Asian dip below $4,200 and is trading with modest losses just under Monday’s six-week peak. Growing confidence that the US Federal Reserve (Fed) will lower borrowing costs again is preventing the US Dollar (USD) from extending its overnight rebound from a two-week low, offering continued support to the non-yielding metal.
Risk-on sentiment caps upside
A broadly positive tone across global equities is limiting safe-haven flows into Gold, keeping gains in check. With traders reluctant to commit ahead of key US data including this week’s Personal Consumption Expenditure (PCE) Price Index XAU/USD remains in consolidation mode. The upcoming data will be crucial in shaping expectations around the Fed’s rate-cut trajectory and will likely set the next directional impulse for both the USD and Gold.
Daily digest market movers
Asian equities opened firmer after Monday’s pullback, weighing on demand for traditional safe havens. Even so, Gold quickly pared its early drop amid persistent dovish expectations for the Fed and weak sentiment toward the USD.
Market participants increased bets on further Fed easing following recent commentary from central bank officials and softer US data. Monday’s ISM Manufacturing PMI slipped to 48.2 from 48.7, missing expectations and signaling a deeper slowdown in the sector—keeping USD bulls sidelined.
On the geopolitical front, US envoy Steve Witkoff is set to meet Russian President Vladimir Putin in Moscow to discuss the Trump administration’s proposal for ending the war in Ukraine. While Ukrainian negotiators have cited progress in earlier talks, US Secretary of State Marco Rubio cautioned that substantial work remains. Moreover, President Volodymyr Zelensky continues seeking stronger European backing amid concerns the US plan may favor Moscow, keeping geopolitical risk elevated and supporting Gold.
Traders now turn their attention to this week’s key US releases, including ADP employment data and the PCE Price Index. These data points will significantly influence expectations for the Fed’s December policy move and could trigger volatility in XAU/USD.
Gold technical outlook: bias stays tilted to the upside
The near-term setup continues to favor Gold bulls, with both 4-hour and daily oscillators holding in positive territory. Any pullback below $4,200 is likely to attract fresh buying interest, with strong support seen at $4,155–4,153. A break below this zone would expose $4,100, followed by the $4,065 confluence of the 200-period EMA on the 4-hour chart and an ascending trendline from late October.
On the upside, a move through the $4,264–4,265 region would reinforce the bullish structure and position XAU/USD for a retest of the $4,300 psychological barrier. Sustained strength above that level could open the way toward $4,340 – 4,345, ahead of October’s all-time high near $4,380.
