Gold (XAU/USD) slipped on Thursday after briefly rising toward $4,110, pulling back from the weekly high set a day earlier. Persistent US Dollar (USD) strength—driven by scaled-back expectations for a December Federal Reserve (Fed) rate cut—continues to pressure the non-yielding metal. A broadly upbeat tone across global equity markets is also weighing on safe-haven demand.
Downside bias intact but NFP could set the tone
The current macro backdrop suggests that the path of least resistance for gold remains to the downside. Still, traders are likely to remain cautious ahead of the delayed US Nonfarm Payrolls (NFP) release for September, a key report that could influence short-term USD direction. Concerns over weakening US economic momentum amid the longest government shutdown on record may also help limit deeper losses in XAU/USD.
Fed minutes reinforce hawkish expectations
Minutes from the October 28–29 FOMC meeting showed policymakers were divided on further rate cuts, with several members warning that easing too aggressively could risk entrenching inflation. The hawkish tone prompted markets to trim expectations for another Fed cut in December, pushing the USD to its strongest level since late May during Asian hours on Thursday. This renewed dollar demand is adding pressure on gold.
Geopolitical developments add to risk-on sentiment
Reports that US President Donald Trump approved a 28-point peace proposal for Russia and Ukraine—allegedly involving territorial concessions and reduced Ukrainian military capabilities—have contributed to a further improvement in risk appetite. A rare wartime visit by US officials to Kyiv to revive peace efforts is another development dampening safe-haven flows into gold.
Technical outlook: key support at $4,018 and resistance at $4,110
From a technical perspective, immediate support is seen at the 200-period Exponential Moving Average (EMA) on the H4 chart, near $4,018. A break below the $4,000 psychological mark could expose the $3,931 support, followed by the late-October swing low around $3,886.
On the upside, initial resistance is aligned at the Asian session high near $4,110. A sustained move above the overnight peak at $4,120 may signal a bullish breakout, opening the door toward the $4,152–4,155 region and potentially the $4,200 handle.
