• The progressing US-China trade talks subdued gold’s safe-haven appeal.
• The 3% inflation YoY reinforces hopes for two Fed cuts by 2025.
• Due to the ongoing Federal government shutdown, the markets face a delay in key data releases. 

The gold outlook shows a steep decline, the first in the last five years, as the pair traded near the $4,070 level on Monday. The pair fell from last week’s record high of $4,381 amid profit-booking as traders anticipated key US economic and policy events.

During the US-China trade talks in Malaysia, both President Trump and Xi reached a tentative framework and discussed trade, export controls, and shipping levies. This progressing situation has further boosted the global risk sentiment, weakening gold’s safe-haven appeal and lifting equities. Both presidents are optimistic about finalizing a deal later this week in South Korea. 

In the US region, another 25 bps cut is expected at the policy meeting this week amid a 3% YoY rise revealed in US inflation data released on Friday. Additionally, a probability of another rate cut in December persists. 

These Fed rate cuts prevent further losses in gold, capping the dollar’s recovery amid strong Treasury yields. Meanwhile, the ongoing geopolitical tensions, such as the Russia-Ukraine conflict, also provide support for the bullion. 
 

Gold Daily Key Events 

On Monday, the US government faces a shutdown and delays the key economic releases, which could impact the metal. 
 

Gold Technical Outlook: Dip-Buying Expected Near $4,000
 

(Click on image to enlarge)

Gold 4-hour chart
 

Gold’s 4-hour chart indicates consolidation, trading below the $4,100. The yellow metal remains wobbling below the 20-period MA. The price stays below the 50- and 100-period MAs as well amid persistent selling pressure. 

The RSI is at 41, signaling restricted buying interest and a bearish bias. However, the 200-day SMA near $3,893 suggests a consolidation, providing underlying support to the pair. A drop below the $4,000 level could lead to a further downside. Conversely, a sustained breach above $4,125 could extend gains. 
 

Support Levels

• $4,000 
• $3,950 
• $3893
   

Resistance Levels

• $4,095
• $4,125 
• $4,191

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