First there was a ten-week low of $4,034 on Thursday, then a drop below the psychological round mark of $4,000 on Friday. In the morning the metal bounced slightly, but remained below $4,000. Silver in the Asian session was sold off along with gold.
Safe-haven money went not into metal, but into US Treasuries: the yield on 10-year notes collapsed by 15 basis points, to 4.963% - the lowest since September 23. Investors fled US equities on fears over credit risks at technology companies that are investing huge sums in AI. Usually a fall in yields helps gold, this time it did not.
The second pressure point is the rate. The market estimates the probability of a Fed rate hike in December at about 80%, an October hike at only 8%. There are reasons: jobless claims for the week to October 17 came in at 194k versus 200k previously, near a 57-year low. The DXY dollar index is holding around 101.62.
Even oil did not lift the metal: WTI gained 1.80%, to $99.50 per barrel, on escalating tensions in the Middle East - Houthis attacked Saudi airports and energy facilities, the US ordered the evacuation of its embassy in Saudi Arabia.
Next up: the Fed meeting next week, the decision on Wednesday, the rate is expected unchanged and without new forecasts - attention will be on the press conference of Fed Chair Kevin Warsh. On Thursday - the first estimate of US GDP for Q3 and the PCE index (the inflation measure the Fed looks at first and foremost).
Technicals: RSI 34.34 - just above oversold territory, MACD -6.51. Resistance is now $4,065-4,070 and $4,100, support below at $3,996, $3,959 and the yearly low of $3,941.
Shorted gold below $4,000?
The week for the metal was clear-cut: a range breakout, two hundred dollars down, the round level like a magnet. But next week there's Wednesday with the Fed and Thursday with PCE, and those are exactly the days when prop firms watch you most closely. For some, a trade in the minute of publication is business as usual; for others it's a violation that gets the account closed, plus separate leverage limits specifically on gold. These things are figured out in advance, not from a disqualification letter.