Gold rebounded slightly ahead of the Fed's decision, but the correction is not yet over and it is expected to remain range-bound.
2025-10-29 13:47:19
Gold prices rebounded from an intraday low of $3,916 during Wednesday's Asian trading session, temporarily moving away from a three-week low range.
The market widely expects the Federal Reserve to announce a 25-basis-point rate cut at its meeting later that day, bringing the federal funds rate range down to 3.75%-4.00%. However, traders were cautious ahead of the announcement, and gold prices rebounded only slightly.
In terms of market sentiment, easing trade concerns have suppressed safe-haven demand. The recent preliminary framework agreement reached between high-level officials of the United States and Asian countries has eased market concerns about global trade tensions, thereby weakening gold's safe-haven appeal.
Meanwhile, the U.S. government remains in a fiscal deadlock, with the Senate failing to pass a temporary funding bill for the 13th consecutive time, reflecting the ongoing political divisions in Congress.
Geopolitically, the U.S. government announced new sanctions against two major Russian energy companies and canceled a planned bilateral meeting, making markets cautious about the global situation.
"Gold's short-term price movement remains constrained by both the Fed's policy and geopolitical risks. If the expectation of an interest rate cut materializes and the statement is relatively dovish, gold prices are likely to find some support in the short term," noted a New York-based precious metals strategist.
From a technical perspective, XAU/USD found some support around $3917, and the daily chart shows the price attempting to form a rebound structure. Support levels below are at $3916, $3900, and $3886 (recent low).
If the price breaks below these areas, it could fall further to $3,843 (50% Fibonacci retracement level) or even the psychological level of $3,800.
Conversely, if gold prices can return above $4,000, it will become a key dividing line between bullish and bearish sentiment. A break above this level would target the mid-term resistance at $0.60, and further challenge the psychological level of $4,100.
Current technical indicators suggest a slightly bearish momentum, with the MACD still in negative territory. However, if gold prices hold above $3,900, the short-term rebound is likely to continue.
Editor's Note:
Gold prices are currently in a dual phase of policy observation and technical correction. Expectations of a Fed rate cut are providing support, while easing trade concerns and a stabilizing dollar are limiting upside potential.
Gold prices are expected to fluctuate between $3,900 and $4,000 ahead of the Fed meeting results. If the rate cut is in line with expectations and the policy statement is dovish, gold prices could break through the $4,000 mark.
Conversely, if the statement is hawkish, gold prices may retest the $3,800 support level. Overall, the short-term trend is likely to be volatile, and the subsequent direction will depend on the Fed's policy guidance and the dollar's reaction.
The market widely expects the Federal Reserve to announce a 25-basis-point rate cut at its meeting later that day, bringing the federal funds rate range down to 3.75%-4.00%. However, traders were cautious ahead of the announcement, and gold prices rebounded only slightly.
In terms of market sentiment, easing trade concerns have suppressed safe-haven demand. The recent preliminary framework agreement reached between high-level officials of the United States and Asian countries has eased market concerns about global trade tensions, thereby weakening gold's safe-haven appeal.Meanwhile, the U.S. government remains in a fiscal deadlock, with the Senate failing to pass a temporary funding bill for the 13th consecutive time, reflecting the ongoing political divisions in Congress.
Geopolitically, the U.S. government announced new sanctions against two major Russian energy companies and canceled a planned bilateral meeting, making markets cautious about the global situation.
"Gold's short-term price movement remains constrained by both the Fed's policy and geopolitical risks. If the expectation of an interest rate cut materializes and the statement is relatively dovish, gold prices are likely to find some support in the short term," noted a New York-based precious metals strategist.
From a technical perspective, XAU/USD found some support around $3917, and the daily chart shows the price attempting to form a rebound structure. Support levels below are at $3916, $3900, and $3886 (recent low).
If the price breaks below these areas, it could fall further to $3,843 (50% Fibonacci retracement level) or even the psychological level of $3,800.
Conversely, if gold prices can return above $4,000, it will become a key dividing line between bullish and bearish sentiment. A break above this level would target the mid-term resistance at $0.60, and further challenge the psychological level of $4,100.
Current technical indicators suggest a slightly bearish momentum, with the MACD still in negative territory. However, if gold prices hold above $3,900, the short-term rebound is likely to continue.
Editor's Note:
Gold prices are currently in a dual phase of policy observation and technical correction. Expectations of a Fed rate cut are providing support, while easing trade concerns and a stabilizing dollar are limiting upside potential.
Gold prices are expected to fluctuate between $3,900 and $4,000 ahead of the Fed meeting results. If the rate cut is in line with expectations and the policy statement is dovish, gold prices could break through the $4,000 mark.
Conversely, if the statement is hawkish, gold prices may retest the $3,800 support level. Overall, the short-term trend is likely to be volatile, and the subsequent direction will depend on the Fed's policy guidance and the dollar's reaction.
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