remains under pressure as a combination of macroeconomic factors and global market sentiment continues to weigh on price action.
From a fundamental perspective, the resilience of the US dollar has been a key driver. Elevated US Treasury yields, particularly across longer maturities, continue to attract capital flows into interest-bearing assets. In this environment, gold tends to lose some of its appeal, as it does not offer yield and becomes relatively less attractive compared with fixed-income instruments.
Another major factor is monetary policy expectations. Markets are still pricing a low probability of near-term rate cuts from the Federal Reserve. As long as expectations for tighter policy remain intact, the dollar is likely to stay supported, creating headwinds for precious metals.
On the geopolitical front, ongoing tensions in the Middle East and other global hotspots would normally support gold as a safe-haven asset. However, current market conditions have produced a different reaction. Heightened volatility across global markets has led some investors to liquidate gold holdings in order to cover losses elsewhere, resulting in additional selling pressure despite persistent geopolitical uncertainty.
Technical Analysis
From a technical standpoint, gold’s broader structure suggests the market remains in a corrective phase after failing to sustain momentum near its all-time highs reached earlier this year.
On the daily timeframe, price has broken below the lower boundary of a major ascending channel, signaling a potential shift in medium-term momentum. This breakdown suggests sellers have regained control after the prior rally, with downside pressure intensifying as key support levels continue to give way.
The primary area of interest now lies around the 0.618 Fibonacci retracement of the previous major bullish leg. This zone becomes particularly significant as it aligns with the 200-day EMA, creating a strong technical confluence. The overlap between the golden ratio and a long-term moving average often acts as a major decision zone for institutional participants.
On the 4-hour chart, the corrective structure becomes clearer. Price previously broke down from a wedge formation and attempted a rebound near the 0.5 Fibonacci retracement level. However, that rebound lacked follow-through and was rejected sharply, reinforcing bearish momentum.
From a wave perspective, the current structure still fits an A-B-C corrective pattern. If this scenario remains valid, the market may now be approaching the final leg of the correction — Wave C. Its projected target aligns with the 0.618 Fibonacci support on the 4-hour chart, which adds further weight to this zone as a potential bottoming area.
Traders should monitor how price reacts once it reaches that support cluster. Signs such as strong rejection candles, bullish engulfing patterns, or the formation of a higher low on lower timeframes would be early signals that buyers may be stepping back in.
Conclusion
Gold remains under pressure as strong US dollar demand, elevated Treasury yields, and delayed rate-cut expectations from the Federal Reserve continue to dominate sentiment.
Technically, the key zone to watch is the 0.618 Fibonacci retracement on the daily chart, reinforced by the 200-day EMA. This area also coincides with the projected completion of Wave C on the 4-hour timeframe, making it one of the most critical support zones in the current market structure.
Until a clear bullish reversal signal emerges, the correction may still have room to extend. Rather than anticipating a reversal too early, the more prudent approach is to observe how price behaves around this technical confluence, as it may determine whether gold is nearing the end of its pullback or preparing for a deeper decline.
