Gold futures have deepened their monthly breakdown to $4,151, sliding well below September's opening levels as climbing Fed rate-hike odds weigh on the metal and the ongoing US-Iran conflict fails to spark a bid. All three timeframes now show the metal below key moving averages, with the daily chart showing a bearish crossover.
Gold futures opened this month at $4,498.70, touched a monthly high of $4,558.50 before reversing to a monthly low of $4,146.20. The metal is now changing hands at $4,151, trading below its 9 EMA at $4,296.22.
Fed rate-hike bets keep pressure on gold
Money markets now price roughly a 66% chance of another Fed rate hike at the October meeting, up sharply from just 9.4% a month earlier. That repricing follows the Fed's first rate increase since 2023 on September 16, which lifted the target range to 3.75%-4.00%.
Meanwhile, 10-year and 30-year Treasury yields have climbed to their highest levels since 2007 and 2004, respectively, making non-yielding gold less attractive to rate-sensitive investors. Cleveland Fed President Beth Hammack said these dynamics, together with concerns over government debt, are pushing long-term Treasury yields higher.
Technical levels point to further downside
On the weekly chart, futures trade at $4,155.32, below the 9 EMA at $4,345, the 20 EMA at $4,378 and the 50 EMA at $4,285.96, after piercing support at $4,180.45 and now testing support near $4,124.32.
The daily chart shows the 9, 20, 50 and 100 EMAs have all crossed below the 200 EMA at $4,480.92, a bearish crossover, with futures at $4,157.30 testing support at $4,122.54.
Iran conflict escalates without lifting gold
The US-Iran conflict entered its 213th day on Monday, with Iran's foreign minister Abbas Araghchi saying the country remains open to diplomacy but is prepared to respond to further US strikes. President Trump said he expects more talks with Iran this week.
Brent crude also climbed 2.8% to $107.26 a barrel while WTI rose 1.8% to $94.07 a barrel. Yet even as that uncertainty builds, gold has failed to catch a bid.
Source: Commodities Analysis & Opinion
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