Gold faces a series of major tests this week.
On Tuesday, the United States holds its midterm elections, with all 435 House seats and 35 of the 100 Senate seats up for re-election. Polls suggest Democrats could retake the House or even the Senate, and the resulting political uncertainty may trigger safe-haven flows.
In addition, the ADP employment report and initial jobless claims will be released in succession, with Friday's October nonfarm payrolls report being particularly critical. Meanwhile, Federal Reserve officials Goolsbee, Hammack, Barkin, Logan and Williams are also scheduled to speak, all of which warrant close attention.
On Monday (November 2), Iranian and Qatari officials held talks for a third consecutive day over the weekend, with mediators pushing to end the US-Israel war against Iran. Diplomats said positive progress was made, and oil prices plunged nearly 2% on Monday. As oil retreated, inflation anxiety eased slightly, allowing gold to climb back from around $3,870 to around $3,900 this morning. That was the direct trigger for today's early-session rebound.
However, the hawkish tone from the Federal Reserve has not softened at all. On the day of last Friday's sharp selloff, Dallas Fed President Logan was still calling for "at least two more hikes of 25 basis points each," while St. Louis Fed President Musalem also said "action will be needed soon." Although the October meeting held rates steady, the two dissenting votes in favor of a hike already tell the story. Futures pricing for a December rate hike fell from 78% to around 70%, but remains far above the "hold steady" scenario. With the opportunity cost of holding gold sitting right there, the confidence behind any rebound is inherently weaker.
From a technical perspective, gold is currently showing signs of an oversold bounce this week, but this is merely a process of rebounding to test overhead pressure. The first area to watch is the pressure contest around $3,930, while the main resistance is seen at the prior low zone of $3,950-60. Alternatively, looking at the daily chart, as long as the market does not return above the daily trendline, the main outlook remains biased toward weak adjustment. That said, caution is also needed against the risk of short-term price action oscillating continuously around $3,930-50. If there is repeated fighting around this zone, bulls may try to exploit this week's US midterm elections and nonfarm payrolls data, but as long as the trendline resistance is not broken, the trend remains weak.
In short, today's trading should prioritize caution, and there is no rush to enter early. If gold bounces higher first and approaches the overhead resistance zone, consider a light short position with the target initially near the lower support, but position size must be controlled, with light positions recommended. News developments can shift at any time recently, and intraday volatility can suddenly reverse direction. Stop-losses are the bottom line — do not remove them to hold through losses. Pace trades slowly; it is better to miss a suitable opportunity than to take risks in an unclear market.
Therefore, intraday operation recommendations: Gold: short at $3,915-3,920, stop-loss at $3,930, target $3,880-3,860. If it holds above $3,930, exit the short on a pullback and go long, targeting $3,960-3,980.
Key economic data and events to watch today: Monday, November 2, 2026 — 22:45 US October S&P Global Manufacturing PMI final reading; 23:00 US October ISM Manufacturing PMI; 23:00 US September construction spending month-on-month; next day 00:15 Fed's Goolsbee speaks.
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