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Spots are limited, so act fast. Let us join together for the sustainable appointment! [Click to register] On October 16, the core logic behind this round of gold's rebound was very clear: a weakening US dollar lowered the holding cost of dollar-denominated gold; falling US Treasury yields reduced the opportunity cost of holding gold; and combined with relatively cautious remarks from Federal Reserve officials, expectations of further rate hikes were suppressed. Even though previous inflation data came in relatively strong, the market's current focus has shifted more toward fiscal constraints, risks of an economic slowdown, and safe-haven demand driven by debt problems in the AI sector. Ongoing geopolitical conflicts also provide additional sentimental support for gold prices.
In the period ahead, key items to track include: the Federal Reserve Chair's speech at 11:30 Beijing time on Friday, subsequent inflation and employment data, and changes in the geopolitical situation. If the US dollar continues to weaken and US Treasury yields remain low, gold prices are expected to hold above $4,100, consolidate the gains of this rebound, and further test higher ranges. Conversely, if inflation continues to exceed expectations, or if Federal Reserve officials send hawkish signals, gold prices will still face short-term correction pressure.
At present, many people still hold a fixed expectation: whenever gold rebounds from the bottom, they think of the one-way surge earlier this year and hope for a repeat of the same trend. But the market has not moved into a sustained rise as expected. After seemingly brief strength, it has pulled back again, making a continuous one-way trend difficult to achieve. Everyone needs to move beyond old thinking and stop fantasizing about replicating the big rally from earlier this year. The market is in a ranging state 80% of the time, and before last year, gold's normal fluctuations were mostly like this as well.
The core reason for the current pattern is the lack of long-term capital entering the market. Even gold ETF funds are mainly engaged in short-term swing operations, buying small positions on dips and taking profits after a rebound. Without sustained incremental capital support, it is naturally difficult to generate a large-scale one-way trend. This itself is the normal state of the market. At this stage, gold will most likely enter a long-term ranging pattern, with occasional small pulse moves, but only at a minor level; it will be very difficult to reproduce the large-scale trend seen earlier this year. Ranging is the main theme of the current market.
The characteristic of a ranging market is support below and resistance above: downside space is limited, but a rapid upward breakout is also quite difficult. For short-term downside support, watch the $4,100 area, while upside resistance remains in the $4,200-$4,230 range. Short-term price action will most likely continue in a ranging pattern. The dividing line on the chart is the $4,230 mark: if gold prices successfully hold above $4,230, the market can only then be considered stronger, with room to open to the upside; if it continues to be capped below $4,230, the market will remain in weak ranging. Since it is Friday, focus on whether this key level can be broken.
Short-term trading reference: consider going long on a pullback to the $4,130 support area; consider going short on a rebound that meets resistance near $4,200. Before the range is effectively broken, maintain a ranging mindset, with operations mainly based on selling high and buying low. Sina partner large platform futures account opening, safe, fast, and secure. Sina statement: This message is reposted from a Sina partner media outlet. Sina publishes this article for the purpose of conveying more information and does not mean it agrees with its views or confirms its description. The article content is for reference only and does not constitute investment advice. Investors operate at their own risk based on this.
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