Gold Grinds Unconvincingly Higher, USD Holds Ground Into FOMC
Gold edges higher but momentum and volume remain weak, while the US dollar holds support into the FOMC — keeping downside risks alive for bullion.
Share this:
Gold continues to recover from its October low, but the rally lacks conviction. Volume is thinning, momentum is soft, and price action looks increasingly corrective. With the FOMC meeting in focus and the US dollar holding firm at support, conditions remain primed for volatility — and potentially a deeper setback for gold if the Fed disappoints dovish expectations.
View related analysis:
View related analysis:
Gold Stalls as the US Dollar Stabilises Into the FOMC
Gold Futures (GC) Technical Analysis
It has been 34 days since gold last traded at an all-time high. Its -6.7% single-day decline on heavy volume marked the start of an 11.1% correction. And although prices have recovered from the October low, the fact it has taken 23 days to do so highlights a weak effort from bulls overall. The also weekly chart shows a small-ranged spinning top doji formed just below 4300 last week.
Furthermore, daily volumes are trending lower even as price grinds higher in a choppy fashion — again suggesting the rebound from the October low is corrective rather than impulsive.
With the FOMC meeting approaching, volatility could push gold in either — or both — directions this week. Even if gold breaks above 4300 in the near term, my view is that it may still fall short of retesting its record high before the next major decline, assuming it enters a wave ‘C’ of an ABC correction from the peak.
Charts prepared by Matt Simpson, Source: TradingView
US Dollar Index (DXY) Technical Analysis
I continue to hold the view that the US dollar is likely to trend lower next year, which should ultimately help gold break to new highs. In the near term, however, the US dollar index is holding above its 100-day EMA and the monthly S1/November low cluster.
Given my suspicion that the Fed will not be as dovish as markets hope, there’s still scope for a short-term bounce in the US dollar — which could weigh on gold before the broader downtrend resumes.
Chart analysis by Matt Simpson - data source: TradingView U.S. Dollar Index Futures
View the full economic calendar
View the full economic calendar
-- Written by Matt Simpson
Follow Matt on Twitter @cLeverEdge
How to trade with City Index
You can trade with City Index by following these four easy steps:
- Open an account, or log in if you’re already a customer
• Open an account in the UK
• Open an account in Australia
• Open an account in Singapore
- Search for the market you want to trade in our award-winning platform
- Choose your position and size, and your stop and limit levels
- Place the trade
Related tags:
Latest market news
Open an account in minutes
Experience award-winning platforms with fast and secure execution, and enjoy tight spreads from 0.5 pts on FX and 0.3 pts on indices.
Economic calendar
Web Trader platform
Our sophisticated web-based platform is packed with features.
Related articles
Gold Does Something it Hasn’t Done in a Year, is Larger Risk-Off Afoot?
With tech stocks getting hit harder last week there was collateral damage elsewhere, including gold as the metal closed below the $4k level for the week and that’s the first time that’s happened to spot gold in more than a year.
Silver forecast: metals liquidation drags XAG/USD into $50-55 support
Silver has broken its July low and slipped into a long-term support zone as the selling in precious metals deepens. The chart shows where the metal could bottom, and next week's Fed decision may decide whether it does.
Silver Forecast: XAG/USD Hits Fresh 2026 Lows as Selling Pressure Accelerates
Trading conditions continue to be challenging for silver in the short term. The precious metal has been losing value at an accelerated pace and, during today's session alone, has fallen more than 5.5%, reaching new lows for 2026. This development highlights how selling pressure has become increasingly dominant across recent market activity.
This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.
StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.
In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.
StoneX Financial Pte. Ltd. is not under any obligation to update this report.
Trading CFDs carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit www.forex.com/en-sg/terms-and-policies for the complete Risk Disclosure Statement.