Gold slides to $3,994 as oil spike and Fed caution outweigh central-bank buying

Gold (XAU/USD) closed at $3,994 on Friday, its weakest level in two months, after trading near $4,025 in Asian hours earlier in the week [1][2]. The metal fell for a third straight session mid-week as silver extended gains and the gold-silver ratio slipped [3]. Pressure has come from a surge in oil prices tied to attacks on Saudi Arabia and the Strait of Hormuz, which has lifted inflation expectations just as the Federal Reserve prepares to meet [1][4][5]. Indian traders on the MCX also saw gold and silver prices fall repeatedly through the week as participants positioned for the Fed decision [6][7][8].

The US 10-year Treasury yield closed at 5.00%, up 47 basis points versus its 200-day average, while the US Dollar Index closed at 101.75, above both its 50-day and 200-day averages [2]. Higher real yields and a firmer dollar raise the opportunity cost of holding non-yielding bullion [1][7]. Yet a steep AI-related equity selloff drove the sharpest one-day Treasury rally in over a year on Friday, with traders also scaling back December rate-hike bets, a shift that could support gold if it persists [9]. Central banks added 79 tonnes of gold in August, nearly five times the typical pace, led by China, according to Goldman Sachs, a trend Goldman calls a lasting structural shift rather than a short-lived spike [10]. That buying has partly offset Russia's tenth consecutive monthly reserve sale, which took its holdings to their lowest since 2019 [11]. Geopolitical risk remains elevated, with US and Israeli officials reportedly planning potential strikes on Iran after the midterm elections and after Israel's October 27 vote, while Iran has threatened to widen retaliation to Saudi energy and data infrastructure [12][13]. Gold ETF holdings have bucked the recent price weakness to reach 2026 highs, according to Heraeus [14].

Gold's daily trend is down, with the close under both the 50-day moving average of $4,230 and the 200-day average of $4,352, sitting 8.2% below the longer average [2]. The 14-day RSI at 30 is close to oversold territory, and the close is 3.4% lower over the past week and 3.5% lower over four weeks [2]. Nearest support sits at $3,961, then $3,942, which also marks the 52-week low; nearest resistance is at $4,120, then $4,166 [2]. On the weekly chart, the close sits below both the 10-week average of $4,298 and the 40-week average of $4,498 [2]. The most recent confirmed swing high was $4,217 on October 12, while the 52-week high stands far above at $5,419 [2].

A daily close back above the $4,120 resistance, or above the 50-day moving average near $4,230, would ease the near-term downward pressure described by the current chart setup [2]. A pullback in US Treasury yields below the 4.92% support level, or a softer dollar, would reduce the opportunity-cost argument weighing on bullion [2]. Confirmation that central-bank buying, particularly from China, continued into October, alongside sustained ETF inflows, would reinforce the structural demand case [10][14]. Conversely, a de-escalation of the Iran-Saudi standoff that eases oil prices could reduce the safe-haven and inflation-premium support for gold [1][4].

FOMC Statement, Federal Funds Rate and press conference, Wednesday October 28, 18:00-18:30 GMT [15].
Euro area Monetary Policy Statement, Main Refinancing Rate and ECB press conference, Thursday October 29, 13:15-13:45 GMT [15].
US Core PCE Price Index, Advance GDP q/q and Unemployment Claims, Thursday October 29, 12:30 GMT [15].
Bank of Japan Monetary Policy Statement, Policy Rate and press conference, Friday October 30, 02:30-05:30 GMT [15].
US CB Consumer Confidence, Tuesday October 27, 14:00 GMT [15].
Israel's election, October 27, cited in reporting on Iran strike planning [12].
Possible US-Israel military action against Iran once Pentagon deployments conclude in early November [12].

1. FXStreet: Gold falls to two‑month low below $4,050 as oil spikes
2. Daily prices: EODHD and Yahoo Finance; trend, levels and RSI computed by Praevis
3. Kitco News: Gold falls for a third straight session as silver extends gains and the gold-silver ratio slips
4. OilPrice.com: Iran Claims Seven Ships Hit in Persian Gulf as Oil Prices Surge
5. Economic Times Markets: Oil Price Today (October 23): Crude oil ticks over $114, jumps nearly 8% this week as energy attacks intensify. What are experts saying?
6. Economic Times Markets: Gold price falls Rs 2,000/10 gram; silver plunges Rs 6,000/kg as traders eye US Fed meet next week. Buy, sell or hold?
7. Economic Times Markets: Gold prices near Rs 1.47 lakh/10 grams, silver falls by Rs 1,144/kg as traders await Fed rate signals. What lies ahead?
8. Economic Times Markets: Gold price falls Rs 1,500/10g; silver plunges Rs 7,000/kg as soaring oil fuels rate hike bets. Time to sell?
9. Economic Times Markets: Treasuries see best day in over a year as AI selloff revives haven demand
10. Mining.com: Central banks pile into gold as China leads buying spree
11. Kitco News: Russia sells 6.2 tonnes of gold in September as bullion reserves fall to lowest level since 2019
12. Investing.com (economy): U.S., Israel prepare for renewed Iran strikes after midterm elections - NYT
13. OilPrice.com: Egypt Moves to Defend Saudi Arabia as Iran War Threatens to Widen
14. Kitco News: Gold and silver prices pressured by hot inflation, but gold ETF holdings buck trend to hit 2026 highs – Heraeus
15. Praevis economic calendar