Gold slides after uncertainty over US Federal Reserve rate policy unsettles market

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Gold slides 1.8% to $4,116 today

Highlights

Reported progress in Iran-U.S. peace talks has eased some geopolitical risk premium on gold, impacting its safe-haven appeal.
Uncertainty over U.S. Federal Reserve interest rate policy continues to cloud the demand outlook for gold.
Gold faces sustained bearish technical pressure, with a probable trading range of $3,999 to $4,233 and downside favored at 67%.

Peace talk progress and Fed policy jitters weigh on safe-haven demand

Progress in peace talks between Iran and the United States was reported, easing some of the geopolitical risk premium typically embedded in gold, according to CNBC. At the same time, ongoing uncertainty regarding future U.S. Federal Reserve interest rate policy continues to cloud the demand outlook for the metal. Despite these pressures, recent periods of heightened geopolitical tension and diplomatic conflict have maintained gold’s role as a preferred safe-haven asset, as reported by Thesouthafrican.

Divergent oscillators as sellers dominate below major technical levels

Technically, the price remains below the MA-20, MA-50, and MA-200 levels, with immediate resistance defined by the Ichimoku Kijun at $4,154. Momentum indicators such as MACD and ADX continue to display sell signals, underscoring the prevailing downward trend. The RSI stands at 36.76, indicating oversold territory, while Stoch RSI presents a strong buy and both CCI and BBP are also flagged as oversold, signaling divergent readings among oscillators. This divergence suggests a market backdrop where sellers retain the upper hand, but the potential for a technical rebound has increased.

Downside risk heightened as volatility band limits rebound odds

In the short term, XAU is anticipated to fluctuate within a corridor between $3,999 and $4,233, consistent with the current volatility band. The likelihood of a downside scenario is higher, with a 67% probability assigned, while an upward move holds a 33% chance. A breakout above $4,154 could shift price dynamics toward a bullish scenario, whereas a break below $3,999 may extend the bearish move.

Viktoras Karapetjanc, macro and sentiment analyst at Traders Union, sees the recent news of progress in Iran–U.S. peace talks slightly reducing gold’s geopolitical support, while Federal Reserve policy remains a key source of uncertainty. He notes that safe-haven demand is still strong due to lingering global tensions. Technically, gold is oversold but sellers are dominant, with potential for a rebound if short-term resistance is breached. The analyst assigns higher odds to further downside but stays open to a reversal on positive catalysts. "In my view, gold offers tactical opportunities around $4,000, but conviction for the bulls will need a clear breakout and stronger macro tailwinds."

Earlier, analysts noted that downside momentum in gold was set to persist despite renewed institutional flows and ongoing central bank demand. The latest developments reinforce this bearish outlook as easing geopolitical tensions and continued technical weakness underscore the need to watch for a decisive move below $3,999, which could trigger further declines.

Source of Data: XAU Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

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