Gold Price Forecast: Traders Eye $4,245 Breakout as Fed Decision Nears
Gold is trading sideways near $3,996 during the Asian session. The precious metal, gold, is trapped within a symmetrical triangle
Quick overview
- Gold is trading sideways near $3,996, forming a symmetrical triangle pattern that may lead to significant price action.
- After a monthly high of $4,380, gold is showing signs of renewed buyer confidence with higher lows, while the 20-day EMA indicates market indecision.
- Traders are monitoring the $4,045 resistance level for a potential bullish breakout, while a dip below $3,886 could signal a bearish trend.
- In India, gold demand has cooled post-Diwali, leading to discounts, while China's premiums have risen, indicating renewed buying interest.
Gold is trading sideways near $3,996 during the Asian session. The precious metal, gold, is trapped within a symmetrical triangle pattern that’s been forming since mid-October. Typically, this particular setup often triggers a major price action.
After placing a monthly high near $4,380, the metal retraced but is now forming higher lows, hinting at renewed buyer confidence. The 20-day EMA has flattened around $3,998, underscoring market indecision, while the RSI (48) reflects balanced sentiment between bulls and bears.
Traders are closely watching the $4,045 resistance level, as a breakout above it could confirm a bullish continuation toward $4,156 and $4,245. However, a dip below $3,886 would signal a bearish extension, possibly dragging prices toward $3,794, where the ascending trendline aligns with a historical demand zone.
Asian Demand Shifts After Festival Rush
In India, gold was sold at a discount for the first time in seven weeks, following the post-Diwali slowdown. Domestic prices slipped to 121,500 rupees per 10 grams, down from this month’s record high of 132,294 rupees. Dealers attribute the cooling demand to volatile price swings and profit-taking by retail investors.
“Volatility has slowed physical demand, with some investors selling coins for profit,” said Ashok Jain, owner of Mumbai-based wholesaler Chenaji Narsinghji.
Meanwhile, in China, premiums rose to $4 an ounce above the global benchmark, comparing to last week’s range of –$20 to +$8. This hike in premium signals renewed buying interest in the world’s largest bullion consumer.
Technical Setup: Breakout Imminent
Candlestick patterns show spinning tops and small-bodied candles, signaling indecision before the next big move. A bullish engulfing candle above $4,045 could spark renewed momentum, while a failure to hold $3,885 may embolden short sellers.
For traders, the risk-reward setup remains attractive — a long entry above $4,050, targeting $4,245, with a stop-loss at $3,885, offers a clean technical framework.
With the Federal Reserve’s rate decision approaching, gold’s current consolidation looks like calm before the storm — one that could determine whether the metal resumes its rally or extends its correction into November.
- Check out our free forex signals
- Follow the top economic events on FX Leaders economic calendar
- Trade better, discover more Forex Trading Strategies
- Open a FREE Trading Account
Save