Gold prices retreated in early trade, weighed down by a firmer U.S. dollar and uncertainty over a potential Federal Reserve interest rate cut in December. Gold futures in New York declined 0.2% to $4,007.20 a troy ounce, while the U.S. dollar index edged up 0.05% to 99.92.
Market sentiment has shifted following recent remarks from Federal Reserve officials. “Fed policymakers Lisa Cook, Mary Daly, and Austan Goolsbee all acknowledged labor market risks but refrained from endorsing another rate cut in December, echoing Chair Powell’s earlier warning for markets not to assume continued easing,” noted Soojin Kim of MUFG.
Adding to the pressure, China announced the end of a tax incentive on gold sales, a move that could dampen domestic demand for the precious metal.
Despite the immediate headwinds, technical analysis suggests gold’s longer-term trend remains bullish. Fawad Razaqzada, a market analyst at FOREX.com, stated that it is premature to call a definitive top, especially since betting against the rally has been an unprofitable strategy over the past year.
According to Razaqzada, if gold prices can stabilize above the $4,000 per ounce level, it would reinforce the view that the long-term uptrend remains intact. For now, short-term resistance is identified around $4,045 per ounce, with initial support at $3,970 per ounce. Spot gold was last trading 0.2% lower at $3,993.87 per ounce.
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