On April 29, gold prices experienced a significant decline ahead of schedule. After briefly touching the 4700 mark during the Asian session, prices began to retreat. The sell-off accelerated in the afternoon session, and during the U.S. session, gold broke below the 4600 level, hitting a low near $4554 before stabilizing somewhat. The metal ultimately closed at $4594, forming a bearish candlestick for the day.
The market's core narrative is currently undergoing a final act ahead of the Federal Reserve's policy decision. Anticipating a hawkish stance, markets have priced in concerns over inflation driven by high oil prices, the complete evaporation of rate cut expectations, and safe-haven capital flowing back into the U.S. dollar amid the U.S.-Iran stalemate. These three forces have combined to break the multi-week consolidation range. The $4550-4600 zone is now emerging as the last line of defense for bullish traders.
While it is widely expected that the Fed will keep interest rates unchanged, market anxiety centers on the possibility of Chairman Powell delivering a "hawkish finale"—using his last press conference to emphasize escalating inflation risks or removing guidance on future rate cuts. This explains why gold prices reacted preemptively to the potential hawkish shock rather than waiting for the actual decision. Additionally, stalled U.S.-Iran negotiations have dampened risk appetite, driving safe-haven flows into the U.S. dollar and crude oil markets, thereby increasing pressure on precious metals. Geopolitical risks, instead of boosting gold, have strengthened the dollar.
From a technical perspective, although gold rebounded slightly after dropping to $4555 overnight, the recovery was limited. Expectations for a rebound to fill the gap around $4650-60 were unmet, as prices struggled to advance beyond $4600. This indicates a fundamental shift in market sentiment. In the short term, without supportive fundamentals, technical adjustment pressures are likely to intensify. Intraday, gold may attempt a corrective bounce, with initial resistance expected near $4600. A break above this level could lead to a test of the $4650-60 resistance zone, though $4630-40 may also act as a key near-term barrier.
Overall, market focus remains on how Powell will set the stage for his successor and his final stance on inflation risks and the interest rate path. Any hawkish signals could serve as the final blow to gold prices. Avoid increasing leverage or chasing momentum in either direction amid current high volatility. Patience is advised until the Fed's decision is announced. If gold manages to hold firmly above $4550 post-announcement, consider accumulating long positions on dips.
Today's trading recommendations: Gold: Sell between $4630-4625, stop loss at $4640, target $4550-4500. Hold if support breaks. If prices stabilize above $4650, consider long positions with upward targets.
Key economic data and events for Wednesday, April 29, 2026: 20:30 U.S. New Home Starts (Annualized) 20:30 U.S. Durable Goods Orders (MoM) 20:30 U.S. Building Permits 22:00 U.S. Senate Banking Committee Vote on Fed Chair Nominee 02:00 (Next Day) Fed FOMC Interest Rate Decision 02:30 (Next Day) Fed Chair Powell Press Conference
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