Gold has erased its Treasury buyback-driven gains after Fed Chair Warsh's hawkish Jackson Hole remarks revived rate-hike bets, and the metal now trades near a key support zone around 4,311. Traders are watching next week's US CPI report and the US-Iran conflict for the next directional move, while a separate technical read shows gold bulls regaining control above 4,310.
Gold gave back all of its Treasury buyback-announcement gains after Fed Chair Warsh retightened financial conditions with a hawkish speech at the Jackson Hole Symposium. Markets have pulled back broadly since then as the hawkish repricing ran its course and conditions stabilized.
CPI report is the next catalyst
Next Friday's US CPI report stands as the key risk event that could shift interest-rate expectations and decide gold's next direction. Traders currently see a 58% chance of a rate hike in September. Only a soft CPI print could pull that probability below 50% and deter the Fed from hiking. If it stays at or above 50%, the Fed may hike regardless, since holding off would send a dovish signal.
For now, gold's upside remains capped by two forces: Fed tightening risk and the escalating US-Iran conflict. A de-escalation in the Middle East combined with a soft CPI-driven dovish repricing would be positive drivers that could push gold to new highs. A hot CPI without de-escalation, however, could trigger another selloff and send gold back below the 4,000 level.
Technical picture splits by timeframe
On the daily chart, gold dropped to a swing low near 4,311 before buyers stepped in to position for a rally toward 4,890. Sellers would need a break below 4,311 to open the door toward 3,885 next.
On the four-hour chart, price sits near a resistance zone around 4,450, where sellers could look to fade the move back toward 4,311, while buyers want a break higher to build bullish bets into the downward trendline. The one-hour chart shows price trading inside a tight channel that may signal weakening bullish momentum.
A separate technical note points to gold rebounding from support at 4,310 and clearing its 50-day SMA, sustaining the recovery wave in place since late June. The RSI has crossed back above 50, and the stochastic oscillator shows a bullish crossover between the %K and %D lines.
If buyer momentum accelerates and clears the 200-day SMA at 4,530, bulls could target resistance at 4,700 and 4,770; a breakdown below 4,310 would instead signal further short-term weakness.
Today's calendar brings Fed's Waller, US jobless claims data, and the US ISM Services PMI, with the US NFP report due tomorrow.
Sources: Investinglive, Investing.com (snippet-based)
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