Article by: ETO Markets

The current fundamental landscape for gold presents a mixed picture but with a slight bearish bias. The Federal Reserve's recent hawkish stance, indicating only two rate cuts in 2025 versus previous expectations of four, has significantly impacted real interest rate expectations. This shift in monetary policy outlook, combined with persistently high bond yields, creates headwinds for the non-yielding metal. However, mounting geopolitical risks, including potential US government shutdown and President-elect Trump's tariff threats, provide notable support through safe-haven demand. The technical indicators and price action suggest increased volatility ahead, with key support levels being tested while upside momentum remains limited.  The technical landscape for gold reveals a complex interplay of support and resistance levels that warrant careful attention.

Currently, the most significant resistance levels are positioned at $…, representing a recent swing high with notable selling pressure, and $…, which has acted as a strong intraday barrier with multiple rejections. Additional resistance can be found at $…, a major psychological level where substantial selling interest has emerged. On the support side, immediate attention falls to $…, the recent monthly low where buying interest has emerged, followed by crucial support at $…, which aligns with previous consolidation patterns. A third significant support level exists at $…, marking the November swing low with historical buying interest. The price action between these levels shows increasing bearish pressure, evidenced by the Relative Strength Index readings on both 14-day and 5-day timeframes displaying diverging momentum. The current price trajectory suggests a primary bearish bias, reinforced by the break below the 100-day Simple Moving Average and expanding Bollinger Bands with a downward tilt.