(Kitco News) – After a week dominated by AI and equity narratives, traders and investors are looking to the Federal Reserve for definitive direction, as gold prices continued their volatile and choppy churn.
Spot gold kicked off the week trading right at $4,100 per ounce, but as would prove the case time and again this week, it was unable to hold any gains above this level. After a second attempt to retake $4,100 failed just after 8:30 p.m. Eastern, gold slid down to support near $4,058 per ounce shortly after midnight. European traders managed to push the yellow metal back to $4,090 per ounce, but by the North American open, gold was trading near $4,074, and after multiple attempts to break above this resistance level failed, gold saw its first dramatic sell-off of the week, dropping all the way to $4,011 per ounce just before 3:00 p.m.
By 6:00 on Monday evening, gold had once again taken $4,050 per ounce, but the momentum was short-lived, and at 2:15 a.m. Eastern, gold set the weekly low just off of $4,000 per ounce.
At this level, the yellow metal was once again attractive, and by the North American open on Tuesday, spot was trading right back at $4,075 per ounce. A retest of near-term support near $4,060 added to the bulls’ confidence during the Asian session, and by 4:30 a.m. on Wednesday morning, gold was once again trading above $4,100 per ounce.
North American traders then jumped on board, but after topping out at the weekly high above $4,130 per ounce just 30 minutes after the open, gold saw its second sharp sell-off, this time falling to $4,065 per ounce by noon EST.
With support and resistance now well established in traders' minds, the rest of the week saw gold trade between $4,030 and $4,100 per ounce, and heading into the weekend, it remained right near the $4,065 support level.
The latest Kitco News Weekly Gold Survey showed the overwhelming majority of Wall Street switching to a bearish or neutral bias, while Main Street investors still maintained a bullish majority.
“I am bullish on gold for the coming week,” said Colin Cieszynski, chief market strategist at SIA Wealth Management. “Technically, it bounced up off of $4,000 support and looks like it wants to climb within a $4,000-$4,200 trading range.”
“Unchanged,” said Adrian Day, president of Adrian Day Asset Management. “Gold likely needs more time before a sustained move higher, though next month’s Federal Reserve rate decision could change things. I do not see much down from here; the fundamental drivers remain and there is buying on the sidelines in the event of any price decline.”
“Up,” said Rich Checkan, president and COO of Asset Strategies International. “Given there has been absolutely no change in fundamentals and no abatement of central bank buying, the downward move and consolidation in gold has been overdone.”
Checkan added that next week will also see thin trading in the U.S. due to the Thanksgiving holiday. “Thin markets tend to see moves one way or the other amplified… and I expect investors would much rather be in the gold trade than out of it,” he said. “Expect higher prices.”
Kevin Grady, president of Phoenix Futures and Options, told Kitco News that markets are waiting on the Federal Reserve to provide direction.
“I think a lot of it is rates,” he said. “Everyone’s waiting to see what they're going to do in December with the rates and they're starting to look at the [previous Fed meeting] minutes and conversations. Every time someone speaks, you see that's what's moving the market. I think the rate situation is what everybody's really looking at.”
Looking at the broader equity market, Grady said referring to AI as a bubble is incorrect.
“Everybody keeps equating this to the tech bubble, but there's a big difference,” he said. “The tech bubble was built on full debt, and these companies never made any money; it was just all on projected earnings. It was just a shaving cream pie: there's nothing in the middle, it just looks nice, and there was nothing behind it.”
“[AI] is a different situation. A lot of the R&D for these companies is being done with cash,” he said. “There is definitely some financing in there, but it's on cash. And the other thing is that there's also tremendous revenues. You look at NVIDIA's earnings… Everybody is waiting for Nvidia, Nvidia beats, and regardless, the market sells off. It's like Groundhog Day. There is a lot of demand now coming out for AI. Even with NVIDIA, they're looking at some cheaper chips that are going to be in big demand for them.”
“I think when you look at these projections all the way out, these companies, they see earnings coming down the pike,” he added. “This is still in the early stages, they're trying to figure out ways to monetize it, but these companies are making money. It's not like they have no earnings, and everything in their stock price valuations are based on just projections. These are actual earnings, and they have good earnings.”
Turning to gold, Grady is still a believer in the yellow metal even after its massive rally, and despite its recent pullback.
“When you look at the S&P, that's up 12% for the year, and gold is up 50% on the year, and gold equities are up 125%... I think there are legs to this rally,” he said. “I think you're going to see gold a lot higher next year. I think it's doing some work here; it's like we used to say, you have to eat your vegetables, and the market's going through this now.”
“I think there's a floor to the market,” he said. “I think central banks, if the market does dip, they're going to be buyers, that story is not going away. These guys are not getting out of those positions. Central banks are not selling their gold.”
“I think gold has legs. I think there's a floor to it, and I think it's got good support.”
This week, 13 analysts participated in the Kitco News Gold Survey, with just a small minority of Wall Street experts maintaining a bullish bias. Only two experts, or 15%, expect to see gold prices rise during the week ahead, while four others, or 31%, predicted a price decline. The remaining seven analysts, representing 54% of the total, expected the yellow metal to trade sideways next week.
Meanwhile, 228 votes were cast in Kitco’s online poll, with Main Street investors’ bullish sentiment waning somewhat from the prior week. 138 retail traders, or 61%, looked for gold prices to rise higher next week, while another 44, or 19%, predicted the yellow metal would lose ground. The remaining 46 investors, representing 20% of the total, expected prices to consolidate during the week ahead.
Next week will feature a number of significant data releases crammed into the first three days as the U.S. government continues to blow through the backlog from the shutdown.
On Tuesday morning, markets will receive the U.S. PPI and Retail Sales reports for September, along with October Pending Home Sales.
Then on Wednesday, traders will be watching for a raft of data ahead of the Thanksgiving Day holiday, including Durable Goods Orders, Preliminary Q3 GDP, Personal Consumption Expenditures, New Home Sales, and weekly jobless claims.
Thursday will see U.S. markets closed for Thanksgiving, and while they will reopen on Friday, there are no other data releases of note.
David Morrison, Senior Market Analyst at Trade Nation, is bearish on the yellow metal in the near term. “The outlook for gold looks uncertain,” he said. “It looks as if the daily MACD needs to reset at lower levels to encourage fresh buying. Despite the tech-led selloff across stock markets, there’s no evidence that investors are looking to gold as an alternative haven asset, so far.”
Sean Lusk, co-director of commercial hedging at Walsh Trading, told Kitco News that gold’s stubborn resilience indicates that prices could buck seasonal trends and go higher.
“It looks like it wants to retest the recent highs,” he said. “The dollar is bid above par here off the Fed, so it's showing a little strength, but that really hasn't resonated with any kind of selloff. Gold and silver got pounded overnight, but you’ve got December option expiration on Monday… Maybe it was just that silver's a whack-a-mole market, you just never know who's in, what the premise is.”
“You would think November is usually a weak time of year for seasonality, but after the government came back on, we saw a tremendous rally then you pretty much gave it a lot of it back,” he said. “We're sitting around here, so I don’t know what the market's really hanging its hat on.”
Lusk said markets will probably take their cues from economic data between now and the end of the year.
“You had the September unemployment report come in a little better, but nothing crazy,” he noted. “I just think that there's just a lot of [whining] with the politicians about affordability and those types of things. It affects consumer sentiment, on top of polling data that seems to be all the rates right now.”
“I think we probably kick around here, go sideways to lower for a little bit, and then we'll see if we get a little Santa rally here in December,” Lusk said. “I don’t know what the Fed's going to say in December if they don't have the data. They signaled in the minutes the other day, that if you don't have the data, it wouldn't be wise to adopt more of an easy posture until you have some hard evidence one way or the other.”
“I don't know what else you would trade off of,” he added. “Obviously, we're way past a lot of earnings, we’re wrapping up the year.”
Lusk said he’s not sure about gold’s direction in the current environment either, but the support at these levels appears strong.
“I would've thought by now we would have had some significant pullback one way or the other,” he said. “That still might happen, but you’ve only got a week left for the month. From a global standpoint, you’ve got a lot of global stock markets have done considerably better, yet I'm still hearing all this noise about central banks keeping buying. Is that really the case? When they back off the pedal is probably when this thing would turn.”
“The charts look very firm,” Lusk said. “We haven't seen any kind of significant setback… which is very odd, because you were down at $3,300 at the end of July, which wasn't too long ago. And a large part of this $4,000, $4,100 an ounce was made in the last three months. So that's probably the area that, if we did see a pullback, it would go back to.”
“As I'm sure you're aware, markets go down a lot faster than they go up on these pushes,” he added. “But we haven't seen any evidence that this thing wants to turn over.”
Alex Kuptsikevich, senior market analyst at FxPro, expects gold prices to decline next week – and he’s watching the 50-day moving average for a potential breakdown.
“Gold managed to withstand the pressure of the US dollar and rising Treasury yields,” he said. “The Golden Bugs even mounted a counterattack for a while, backed by positive signals from the physical metal market. However, the decline in the chances of a federal funds rate cut in December to 32% has clipped their wings.”
Kuptsikevich cited Goldman Sachs estimates that central banks purchased 64 tonnes of gold in September, triple the amount from August. “TD Securities sees signs of increased demand from large investors for ETFs, and UBS has raised its 2026 forecast by $300 to $4,500 per ounce,” he noted. “About 26% of Bank of America respondents believe that gold will outperform commodities and currencies over the next year.”
“We continue to believe that the collapse in prices a month ago put an end to gold's three-year rally,” he countered. “However, it has been holding up fairly well in recent weeks, ignoring both the stronger dollar and the progress of the peace plan for Ukraine. Earlier this year, similar issues had a noticeable impact on traders, causing prices to fall. However, bulls are now holding gold above the trend line, which is the 50-day moving average. A fall below this level could change the prevailing trade for this instrument.”
Michael Moor, founder of Moor Analytics, believes gold’s price action will likely reverse course next week.
“Down, unless we see a maintained gap higher on Monday,” he wrote. “In a Higher time frame: I cautioned on 8/16/18 the break above $1,179.7-$1,183. warned of renewed strength. We have seen $3,214.3. This is ON HOLD. On a Medium time frame: The break above 31482 warned of strength for days—we rallied $1,249.8. The trade above 32214 projects this upward $100 (+)—we rallied $1,176.6. The trade above 32236 warned of renewed strength—we rallied $1,174.4. The trade above 32392 projected this up 115 (+)—we attained $1,158.8. The trade above 33411 has brought in $1,056.9 of strength. The trade above 33850 has brought in $1,013.0 of strength. The trade above 34186 has brought in $979.4 of strength. The break back above 35640 has brought in $834.0 of strength. The trade above 36658 has brought in $732.2 of strength. The trade above 37143 has brought in $683.7 of strength. The break above 37725 has brought in $625.5 of strength. The trade back above 38828 brought in $515.2 of strength. These are ON HOLD.”
“On a Lower time frame: The trade above 39732 (+3.5 tics per/hour) has brought in $276.8 of strength. This is ON HOLD,” Moor said. “I warned the failure back below 41960 was bearish—we have come off $198.6. The trade below 41556 has brought in $158.2 of pressure. These are OFF HOLD.”
“We were in a lower timeframe bullish correction against the move down from 42500, and basically held exhaustion at 41250 with a 41343 high and rolled over,” he added. “The trade below 40576 (+8 tics per/hour) warns of decent pressure, but decent trade back above should bring in decent strength. Decent trade below 40255 (+3 tics per/hour) will project this downward $120 minimum, $265 (+) maximum.”
And Kitco senior analyst Jim Wyckoff said gold traders will likely take their cue from how the U.S. stock indexes perform after yesterday’s extreme volatility. “Solid selling pressure in equities would likely drive better safe-haven demand,” he said.
“Technically, December gold futures bulls’ next upside price objective is to produce a close above solid resistance at the November high of $4,250.00,” Wyckoff said. “Bears' next near-term downside price objective is pushing futures prices below solid technical support at $4,000.00. First resistance is seen at $4,100.00 and then at this week’s high of $4,134.30. First support is seen at the overnight low of $4,018.10 and then at $4,000.00.”
At the time of writing, spot gold last traded at $4,065.38 per ounce for a loss of 2.68% on the week and 0.30% on the day.
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