After a sharp sell-off, gold is currently struggling to find price support and stabilize. The strength of the US dollar and changes in US Treasury yields will directly influence the future trajectory of spot gold; the combined force of these two variables will dominate any subsequent pullback or rebound in gold prices. The US dollar index closed lower for the second consecutive month in August. Even though Kevin Warsh's hawkish remarks at the Jackson Hole Economic Symposium provided a temporary boost to the dollar at the end of summer, the dollar index still recorded a downward trend throughout August, dragged down by multiple factors including the US Treasury's intention to suppress long-term Treasury yields, gradually cooling inflation, a weakening labor market, and a decreased market expectation of further tightening of monetary policy by the Federal Reserve. By late August and early September, market expectations for a Federal Reserve rate hike at the next FOMC meeting surged to over 60%, pushing the dollar index back some of its previous losses. Some market observers believe that Warsh's speech at Jackson Hole not only corrected previous communication errors but also helped rebuild market confidence in policy. With his statements taking effect, coupled with the US Treasury's intention to control Treasury yields, the market's logic for "currency devaluation trading" was established, becoming an undeniable macroeconomic backdrop for the precious metals market. Benefiting from reduced investor interest in bonds and fiat currencies, gold recorded a nearly 10% gain in August, its best monthly performance since January. However, the upward trend was not without its challenges: Warsh's hawkish remarks, coupled with escalating conflicts in the Middle East, caused gold prices to retreat by over 3% at one point. The renewed military confrontation between the US and Iran pushed Brent crude oil prices above $90 per barrel, raising concerns about a resurgence of inflation and potentially forcing the Fed to restart tightening, which also added significant resistance to gold's rise. Despite gold's strong overall performance in August, spot gold still faces the risk of a pullback, primarily triggered by shifts in market confidence regarding the Federal Reserve Chairman's policy stance. Trump publicly stated that Warsh would ultimately implement policy actions as expected; while Scott Bessant suggested that the US Treasury and the Fed are cooperating, and he favors the Fed maintaining interest rates unchanged at the next FOMC meeting without raising rates. These two diametrically opposed market views further amplify the uncertainty surrounding gold prices. (Spot gold daily chart source: FX678) Wells Fargo predicts that the US dollar is likely to weaken before the end of September, given that the Federal Reserve's policy statements have fallen short of market expectations for interest rate hikes. If the Fed chooses to hold steady and not tighten monetary policy, the upward trend in gold is likely to continue, and gold prices will open up further upside potential. However, precious metals still face significant pressure. Global debt market yields have rebounded to levels not seen since the 2008 financial crisis, with the 10-year US Treasury yield hitting a 19-year high. Gold itself does not generate interest income, and when market interest rates continue to rise, interest-bearing assets like US Treasuries will divert a large amount of funds, weakening gold's attractiveness as an investment and hindering a rebound in gold prices. The interplay between high short-term US Treasury yields and medium- to long-term expectations of a weaker dollar will likely cause gold to fluctuate between these two forces. Further price movements will require continued monitoring of Fed policy signals and geopolitical developments.