Gold Remains Depressed Above $4,100 As Traders Eye US CPI For Fed Rate Cues

Gold (XAU/USD) sticks to modest intraday losses through the early part of the European session on Tuesday, albeit it holds above the $4,100 mark amid mixed fundamental cues. Firming US Federal Reserve (Fed) rate-hike expectations turn out to be a key factor driving flows away from the non-yielding bullion. Meanwhile, the US Dollar (USD) struggles to lure buyers amid mixed signals regarding the state of diplomatic talks between the US and Iran, offering some support to the commodity as traders seem hesitant ahead of US consumer inflation figures.

In the latest developments around the Middle East crisis, US President Donald Trump said that there was positive momentum toward ending the war on Iran, and that a resumption of strikes is quite unlikely, declaring the conflict effectively over. However, Mohsen Rezaei, Secretary of Iran’s Supreme National Security Council, dismissed reports of active negotiations as fake news and reiterated that Washington must accept Tehran's seven conditions to end the conflict. This keeps the geopolitical risk premium in play, albeit it does little to revive demand for the safe-haven USD and acts as a tailwind for the Gold price.

Meanwhile, the US Nonfarm Payrolls (NFP) report showed last Friday that employment rose by 165K in October, surpassing even the most optimistic estimates. Moreover, the readings for August and September were revised upward by a combined 84K. Adding to this, a downtick in the Unemployment Rate to 4.1% signaled continued resilience in the economy and underpins prospects for additional Fed tightening. According to the CME Group's FedWatch Tool, traders are currently pricing in over an 80% chance that the US central bank will raise borrowing costs in December, which is seen as exerting pressure on gold.

Traders, however, opt to wait for more cues about the Fed's future policy path. Hence, the focus will remain glued to the release of the latest US Consumer Price Index (CPI) report, which will play a key role in influencing the USD price dynamics and provide some meaningful impetus to gold. Hence, it will be prudent to wait for some follow-through selling before confirming that the XAU/USD pair's recent recovery from the $3,870 region, or the lowest since September 2025, touched last month, has run its course and before positioning for the resumption of the depreciating move witnessed over the past two months or so.

XAU/USD 4-hour chart

Technical Analysis

The XAU/USD pair holds a constructive near-term bias following the recent breakout above the 100-period and 200-period Simple Moving Averages (SMAs) on the 4-hour chart. Moreover, momentum indicators stay mildly positive, with the Relative Strength Index hovering near 57 and the Moving Average Convergence Divergence (MACD) just above the zero line. This suggests that upside pressure remains intact while not yet overstretched.

Hence, any subsequent slide could find immediate support near the 200-period SMA at $4,103 and the 23.6% Fibonacci retracement at $4,059, while the 100-period SMA around $4,042 forms a deeper cushion that would need to hold to preserve the current bullish structure. On the topside, initial resistance is seen at the 38.2% Fibo. level near $4,180, ahead of the 50.0% retracement around $4,279 and the 61.8% Fibo. retracement, close to $4,377, which together outline the next bullish objectives if buyers extend the advance.