During the U.S. trading session on Tuesday, November 3, spot gold slipped back into negative territory as violent swings in oil prices continued to drive market direction.
Spot gold traded near $3,933, down 0.31% on the day, but still above its intraday low of $3,895. Earlier, unconfirmed reports that the United States and Iran had made concessions on Iran's nuclear program and the release of frozen funds briefly pushed oil prices lower, giving gold some room to rebound. But crude prices then recouped part of those losses.
Earlier on Tuesday, reports said the United States carried out strikes on Iran's Qeshm Island, sending oil prices higher. Since the conflict broke out in late February, the link between oil prices and rate expectations has been the core driver of gold, which tends to move inversely to oil. Higher energy costs intensify inflation pressure, pushing central banks, especially the Federal Reserve, to keep rates high or tighten further.
The Fed hiked by 25 basis points in September, paused in October, and reiterated its commitment to price stability, leaving room for further increases. The CME FedWatch tool shows a 75% probability of a December hike. Uncertainty in the Middle East, sharp oil volatility and hawkish Fed expectations continue to support the dollar — even though it has pulled back slightly from recent highs — adding another layer of downward pressure on gold.
Stronger-than-expected U.S. labor data also boosted the dollar. September JOLTS job openings rose to 7.523 million, above the prior 7.19 million and beating the 7.13 million forecast. The U.S. Dollar Index (DXY), which tracks the greenback against six major currencies, traded near 101.93.
Against this backdrop, gold's rebound rests on very fragile ground, with the outlook for U.S.-Iran talks unclear and oil prone to sharp swings. Traders now face a data-heavy U.S. employment week: JOLTS openings on Tuesday and the nonfarm payrolls report on Friday. Markets are also watching Tuesday's U.S. midterm elections, whose results could move the dollar and, in turn, gold.
Dollar outlook: midterm results and Iran geopolitical risk
Norman Liebke of Commerzbank said that if Republicans lose majorities in both the Senate and the House, the dollar could come under greater downward pressure, weakening overall political support for the Trump administration. Even if only control of the House changes hands, the dollar would still face some resistance, though the impact would be more limited. Conversely, if Republicans retain control of both chambers, that would support the dollar.
Liebke also stressed that developments after the midterms will matter just as much for the dollar. He warned in particular that if Trump again escalates the conflict with Iran and launches a new round of strikes, energy prices would rise in the short term and market risk appetite would shift. In such a risk-averse environment, the dollar would benefit from its safe-haven status, just as it did when the Iran conflict first erupted.
Daily chart: gold pressed below all major moving averages
On the daily chart, spot gold is trading below all of its moving averages — MA20 at 4,077.87, MA50 at 4,226.11, MA100 at 4,205.84 and MA200 at 4,480.06 — with the averages stacked from top to bottom, capping prices layer by layer and leaving the daily trend bearish. MACD remains below the zero line with green bars intact, meaning bearish momentum is still being released and there is no clear sign of a turn yet. RSI (14) reads 35.90, close to the 30 oversold line, in a weak range; selling pressure has been partly absorbed but no clear oversold stabilization signal has been triggered.
Resistance levels
First resistance: MA20 at 4,077.87. Second resistance: the MA50/MA100 overlap zone at 4,205–4,226. Further structural resistance: MA200 at 4,480.06.
Support levels
First support: the yearly low of 3,870. A decisive break below that level would open up more downside room.
The bearish moving-average setup is clear and the indicators lean bearish. With RSI near oversold, a small technical bounce cannot be ruled out in the short term, but any rebound should first be seen as a repair. Overhead moving-average pressure is heavy, and only a sustained hold above MA20 would offer a chance to reverse the near-term weakness.
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