Gold prices extended their recovery from recent lows in early trading, with spot gold oscillating in a $4,060-4,080 per ounce range during the Asian session, touching an intraday high of $4,082.50 and a low of $4,025.23.
The metal is showing a pattern of a dip followed by a rebound, but overall remains in a consolidation phase.
The Federal Reserve held its benchmark interest rate steady at 3.75%-4.00% as expected, though two officials dissented.
With inflation still elevated and oil prices rising again, market expectations for a December rate hike have increased, pushing the 10-year U.S. Treasury yield above 5% and keeping the dollar index steady near 102.
This continues to weigh on the opportunity cost of holding gold. After the rate decision, gold prices initially came under pressure before being pulled back up by bargain hunting, indicating support at lower levels but also resistance at higher levels.
From a technical perspective, gold remains in a short-term oversold recovery phase and has not yet formed a clear one-way reversal. The $4,070-4,085 area is a key near-term resistance zone; without a high-volume breakout, upside potential may remain limited. On the downside, $4,040 serves as near-term support, while the $4,025 area represents the defense zone for the recent low.
Morning trading is likely to see range-bound action, with investors focusing on upcoming U.S. PCE data, initial jobless claims, and whether the dollar and Treasury yields continue to strengthen. For morning trading, aggressive traders may consider short positions at $4,070/80, while conservative traders may look to short at $4,110/20, targeting a break below $4,025. On the long side, aggressive traders may consider buying at $4,040/30, while conservative traders may look to buy at $4,012/02, targeting a break above $4,080. The key dividing line for gold is $4,030 per ounce. The above analysis is for market logic deduction only and does not constitute investment advice.
Crude oil extended its mildly bullish consolidation in early trading, with WTI crude returning above $102 per barrel and Brent crude holding in the $111-115 range. SC crude performed relatively weakly in the night session, showing continued rhythm divergence between domestic and international markets.
The core driver of overnight oil price strength remains geopolitical risk premium. Houthi forces claimed an attack on Saudi Arabia's Ras Tanura refinery facility, and navigation through the Strait of Hormuz remains subdued, keeping concerns about Middle East supply disruptions alive.
Meanwhile, EIA data showed U.S. commercial crude inventories fell by 1.892 million barrels for the week ending October 23, below expectations, while the Strategic Petroleum Reserve dropped to its lowest level since 1982. The low inventory environment continues to provide bottom support for oil prices.
However, the upside is not without resistance. Although the Fed kept rates unchanged, the 10-2 vote revealed growing internal division, inflation remains high, and December rate hike expectations are rising. The dollar and Treasury yields holding at high levels are capping oil prices. In addition, Middle East diplomatic efforts are still ongoing; if substantive de-escalation signals emerge, the geopolitical premium could be given back again.
On the technical front, WTI is in a tug-of-war within the $100-103 range, with $100 serving as near-term support and the $103.5-$103 area acting as upside resistance. Brent should be watched for support at $111-112 and pressure near $115.
Morning trading is expected to remain in a high-level choppy pattern, and chasing gains is not advisable. Investors should closely track Middle East developments, U.S. Q3 GDP and core PCE data, as well as OPEC+ policy signals. For morning trading, aggressive traders may consider short positions at $102.8/103.3, while conservative traders may look to short at $105.2/105.7, targeting a break below $100.0. On the long side, aggressive traders may consider buying at $100.7/100.2, while conservative traders may look to buy at $99.0/98.5, targeting a break above $103.5. The key dividing line for WTI is $100 per barrel. Note: The above is market deduction and does not constitute definitive buy or sell advice.
This article is for informational purposes only and does not constitute investment advice. Investors who act on this information do so at their own risk.
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