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FXStreet reported that gold attracted some follow-through selling amid a combination of negative factors even as the metal showed resilience below the key psychological level. December Federal Reserve rate hike bets and a modest recovery in the US dollar weighed on the commodity throughout the session. Market participants are now turning their attention to the crucial FOMC meeting scheduled to begin next Tuesday for further direction on monetary policy.
The overnight breakdown below a short-term trading range support and a sustained close below the $4,100 mark served as a key trigger for bearish moves in gold, the analysis found. With the Relative Strength Index hovering at 34.34 just above oversold territory and the MACD at -6.51 in negative territory, downside pressure persists despite early signs of stabilization. However, the metal demonstrated some resilience below the $4,000 mark, warranting caution before positioning for further losses.
Any attempted recovery is likely to face selling pressure near the $4,065 to $4,070 region, which has now turned into resistance from previous support, according to the technical assessment. Gold had slid to a fresh three-month low at $3,986.74 during Asian trading hours on Friday. This decline occurred amid surging energy prices that added to inflationary concerns influencing policy expectations.
This latest price action reflects broader trends in the gold market throughout 2026, where the metal has seen sharp swings from record peaks above $5,000 earlier in the year as reported by Reuters in February. Central bank buying has continued to provide underlying support even during periods of sell-off, a pattern noted in assessments by Shanghai Metals Market. Such buying has helped prevent deeper corrections in the face of rising opportunity costs from higher yields.
The US dollar’s performance and Treasury yields have played a significant role in gold’s recent movements, with both factors increasing the opportunity cost of holding the non-yielding asset. As per data from financial platforms, the 10-year Treasury yield had climbed to levels not seen in decades earlier in the week, contributing to pressure on bullion. Investors are closely monitoring how these dynamics evolve in the lead-up to the Fed’s policy decision.
Analysts have said the outcome of the FOMC meeting could clarify the trajectory for interest rates, potentially influencing gold’s appeal as a safe-haven asset. The current environment underscores the metal’s sensitivity to macroeconomic indicators and central bank signaling.
