(Kitco News) – Gold prices suffered another sharp weekly decline as an early recovery driven by falling oil prices and a weaker U.S. dollar was overwhelmed by hotter-than-expected inflation data, surging Treasury yields, and increasingly hawkish Federal Reserve expectations, sending the precious metal to its lowest level in more than a year.
Spot gold kicked off the week trading at $4,066.39 per ounce on Sunday evening, and the yellow metal pushed sharply higher on Monday as renewed U.S.-Iran diplomatic efforts helped ease crude oil prices and inflation concerns, while a softer dollar supported precious metals. The recovery pushed gold back above $4,100, with spot prices setting their weekly high at $4,148.95 per ounce on Monday before sellers returned ahead of Tuesday's consumer inflation report.
The reversal accelerated on Tuesday morning after October CPI rose 0.4%, exceeding expectations, while core inflation also surprised to the upside. The stronger inflation readings revived speculation that the Fed could raise rates by as much as 50 basis points in December, pushing Treasury yields and the dollar higher. Gold then broke definitively below $4,000 per ounce on Wednesday as hawkish comments from Fed officials reinforced expectations for further tightening, overwhelming safe-haven demand despite renewed tensions surrounding Iran and the Strait of Hormuz.
Selling then intensified Thursday as Treasury yields approached 5% and the dollar strengthened, while continued uncertainty over the Middle East conflict and the inflationary impact of energy prices kept traders focused on the possibility of additional rate hikes. Gold ultimately set its weekly low at $3,852.10 per ounce on Thursday morning, before bargain-hunting emerged near its lowest levels since October 2025.
The metal recovered modestly on Friday after October producer prices showed moderation, and gold finished the session near flat on the day heading into the weekend.
The latest Kitco News Weekly Gold Survey showed Wall Street sentiment turning sharply bearish following gold’s weak weekly performance, while Main Street bears swelled to the majority after gold prices slid below $3,900 per ounce.
“Gold slumped around 4.5% last week,” said Marc Chandler, managing director at Bannockburn Global Forex. “The firmer US CPI following a respectable jobs report pushed up interest rates and interest rate expectations and seemed to take a toll on the price of gold. It was sold to a new low for the year (basis spot) to around $3852.70.”
“A significant low does not appear in place,” Chandler warned. “My next technical target is around $100 lower. A break of the $3750 area could target $3500.”
“Up,” said James Stanley, senior market strategist at Forex.com. “I think we’ll see another pop above $4k in spot, but I’m less certain as to whether that holds.”
Adrian Day, president of Adrian Day Asset Management, said gold prices are trapped between conflicting drivers, and he sees the yellow metal treading water in the near term.
“Unchanged,” he said. “There are pressures on both sides, longer-term fundamentals very bullish, but shorter-term factors are bearish. Until the war in Iran ends, gold will face headwinds of a stronger dollar, and an oil price raising inflation expectations and therefore expectations of a Federal Reserve rate hike at its next meeting (now 100% expecting a quarter point or half point increase in the Fed Funds rate).”
Daniel Pavilonis, senior commodities broker at StoneX Group, told Kitco News on Friday that the trajectory for gold is tilted firmly to the downside, and traders who buy the near-term bounce off of current levels could be washed out as aggressive Fed rate hikes ultimately push the precious metal down to $3,200 per ounce.
“The charts do not look good,” Pavilonis said. “And the dollar continues to get stronger. I think we're at a major inflection point here, and if we really start to break down, we can make another leg down.”
“The overwhelming theme of the market just seems non-existent right now,” he added. “There's no [narratives of] central bank buying and stockpiles running low, all the stuff that we saw around this time last year and into the beginning of this year. We've been just trying to mitigate a lower move that's losing any kind of momentum and building momentum, in fact, to the downside.”
Pavilonis said he’s essentially neutral on the metals right now. “I don't see an edge,” he said. “I’m long-term bullish, but right now it just seems that the market can be sideways for a long time, range-bound, until something really starts to take shape here.”
“We're right at the support level where things can bounce, but I don't know if that bounce is even meaningful,” he warned. “I would probably sell into the bounces.”
Turning to this week’s hawkish Fedspeak, which has reinforced the possibility of larger and faster rate hikes, Pavilonis said he doesn’t believe that the possibility of a 50-basis-point December hike is fully priced into gold.
“If you start to see half-point rate hikes, they're just going to crash the market,” he said. “I don't think they're good at navigating this, because they're too political; they overstate things. If that happens, we see a washout in gold. I think we would start a new wave lower, from the 100-week moving average down into the 200-week moving average. Essentially, $800 an ounce, $900 an ounce [lower].”
Whether the December rate hike proves to be 25 or 50 basis points, Pavilonis will take it as further proof that there's no reason for gold to go higher in the near term. “It's the inverse correlation with rising interest rates,” he said. “At some point, the Fed just overstays with higher interest rates and then backs off, and then after a certain period of time, they start cutting interest rates, that would maybe make gold move higher.”
Pavilonis expects there will probably be some accumulation of weak hands trying to buy into the market in the next little while. “But I expect to see one more aggressive washout, and then the market continues to move higher.”
As to how far that leg down could go, Pavilonis said we’re currently trading at the 100-week moving average, and he could see prices testing the 200-week moving average near $3,200 per ounce.
This week, 13 analysts participated in the Kitco News Gold Survey, with Wall Street maintaining its bearish bias after gold prices dropped below $3,800. Two experts, or 15%, expected to see gold prices gain ground during the week ahead, while 10 others, representing 62%, saw the yellow metal declining further. The remaining three analysts, 23% of the total, said they couldn’t predict gold’s direction, or expected sideways trading next week.
Meanwhile, 160 votes were cast in Kitco’s online poll, with Main Street bulls slipping into the minority after gold’s weak performance. 67 retail traders, or 42%, looked for gold prices to rise next week, while 60 others, or 38%, predicted the yellow metal would lose ground. The remaining 33 investors, representing 21% of the total, expected to see price consolidation during the week ahead.
Next week will be a busy one on the economic news front, with key gauges of consumers, industry, housing and employment on the docket, along with the minutes from the Federal Reserve’s October meeting.
Monday morning will see the release of the Empire State Manufacturing Survey, followed by comments from Fed Chair Kevin Warsh from a conference in San Francisco. Then on Tuesday, traders will be watching Retail Sales for October
Wednesday morning will see the publication of October’s Pending Home Sales, with the Federal Reserve’s October meeting minutes coming in the afternoon. Then on Thursday, markets will be looking at the Philly Fed Survey, along with weekly jobless claims.
The data calendar wraps up on Friday morning with the revised University of Michigan Consumer Sentiment survey.
Jesse Colombo, independent precious metals analyst and founder of the BubbleBubble Report, told Kitco News that gold is teetering on the brink of a far more significant breakdown, and if the U.S. dollar’s recent rally goes much higher, the yellow metal could lose an additional $400 to $500 before the next meaningful support kicks in.
Colombo said that dollar strength and rising interest rates are driving gold’s current weakness, along with liquidations due to the tech sell-off.
“It's still at that major support that's roughly $3,900 in COMEX futures,” he said. “I know it's slightly below there, but in order to feel more confident that this was a true breakdown, I would want to see it break with a higher margin, and it still hasn't done that.”
“It also did something similar right before the midterm, where it went right below, started triggering some stops, and then bounced again, so that's what I'm watching right now,” he added. “It hasn't been a clear breakdown yet.”
Colombo said the current support zone is not arbitrary. “It's what has really acted as a support since one year ago, going back to the October, November [2025] lows,” he said. “And then if you draw a zone across horizontally, you can see it touched it briefly when it sold off intraday in March at the worst of the sell-off. Then it did the same thing back in June and July, hit that same support and bounced off of it. And now it's retesting.”
“Is it down from here, or is it not? We're really on the cusp here.”
Colombo said that if the support zone around $3,900 per ounce does fail, he expects gold prices to fall at least $400.
“There's an air pocket from here down to around $3,400, $3,500,” he said. “So if it does indeed break, with a high enough margin, then I would expect it to head down to that next level of around $3,500.”
Going forward, Colombo pointed to the rise in the dollar as a major factor.
“The dollar, when it does this, acts like a wrecking ball to precious metals,” he said. “And [the dollar index] just broke out above 102, 103. So right now, the momentum is to the upside in the dollar. Until I see that dollar rally start to top out, I'm reluctant to call a bottom. And there is a chance gold could break below $3,900 if the dollar does keep on rallying strongly like this.”
Alex Kuptsikevich, senior market analyst at FxPro, expects gold prices to decline further next week.
“Last week’s rebound in gold gave way to a fresh wave of declines, pushing the price to its lowest level since October 2025,” he said. “The rising US dollar and attractive bond yields remain the key fundamental drivers. A strengthening dollar, coupled with a 5 per cent yield on 10-year bonds, presents a compelling case against gold. The current move to new lows appears to be a resumption of the sell-off after a brief pause in early November, when some traders avoided the dollar due to the mid-term elections. Now, however, the decline has resumed as part of the downward trend towards 3,300 that we described earlier.”
“That said, the Fed could seriously stand in the way of this move if it dampens market expectations of a 50-basis-point interest rate hike in December,” Kuptsikevich added.
Analysts at CPM Group issued a ‘Stand Aside’ recommendation for gold on Friday, with an Initial Target Range of $3,800 - $4,160 between November 13 to 27.
“Gold prices fell sharply yesterday to $3,856.70 from a recent high of $4,157.70 on 9 November, before recovering,” they wrote. “The decline, along with other metals and commodities, as well as equity prices and bond prices around the world, reflected a shift in financial market consensus attitudes: Toward higher inflation expectations, higher U.S. interest rates as a result, lower economic growth going forward, and shifting but still highly problematic political conditions both globally and domestically in several major countries.”
CPM noted that momentum for higher prices had been building since the start of November. “The move higher failed to break resistance levels in recent days, however, as the above-mentioned menu of potentially hostile developments gained prominence in the minds of investors,” the analysts said. “The lack of follow-through buying after gold rose around $160 in four trading days no doubt was one of the reasons why prices retreated sharply yesterday, following a break below the $4,000 support level.”
“Attitudes toward a 25-basis-point increase in the Fed Funds rate at the FOMC 8 – 9 December meeting have grown sharply, to 91% in the CME Fedwatch market,” they said. “There also has been increased talk of a 50 basis points increase by the Fed, either in December or in two stages, following higher than expected inflation figures for the United States in October, released earlier this week. There also has been some U.S. dollar appreciation, which typically weighs on U.S. dollar-denominated commodities.”
“This all said, the recent decline in gold prices only appears to have overflowed onto silver prices, with platinum and palladium prices being relatively less affected,” CPM wrote. “If prices manage to hold support over the next few days, they could recover quickly. In the meantime, there are various economic, financial, political, and technical forces pulling at prices on the up and downside.”
Michael Moor, founder of Moor Analytics, sees gold prices declining once again next week.
“LOWER unless we break back above the formation mentioned below,” he said. “In a Higher time frame: I cautioned on 8/16/18 the break above $1,183.0 warned of renewed strength. We have seen $4,443.1. This is ON HOLD. We held exhaustion with a 56268 high and rolled over $1,770.1. This is OFF HOLD. On a medium-timeframe basis: The trade below 52554 projected this down $740 (+)—we attained $1,398.7. The trade below 52036 brought in $1,346.9 of pressure. The trade below 51606 brought in $1,303.9 of pressure. These are OFF HOLD. We held exhaustion with a 49177 high and rolled over $1,061.0. The break below 48185 projected this down $185 (+)—we attained $961.8. The trade below 47923 projected this down $205 (+)—we attained $935.6. These are OFF HOLD.”
“On a lower timeframe basis: The break below 46369 brought in $780.2 of pressure,” Moor wrote. “The break below 45886 projected this down $205 (+)—we attained $731.9. The trade below 44227 projected this down $400 (+) max—we attained $566.0. The break below 43582 brought in $501.5 of pressure. The break back below the 42183 and 42167 lines brought in $361.6 and $360.0 respectively. The break back below 41979 brought $341.2 of pressure. The failure back below 41298 (-2.2 tics per/hour) brought in $273.1 of pressure. Tuesday, we left the bearish reversal above warned about—we have come off 224.5 from the 40812 open. The break below 40351 has brought in $178.4 of pressure. The break below 39468 (-5.7 per/hour) has brought in $90.1 of pressure; but decent trade back above should bring in decent strength again. Yesterday we left a medium bearish reversal above as well.”
“NOTE: we may be in the last stretch of the move down from 56268 on a higher timeframe, and 47550 on a medium timeframe, with possible exhaustion at 38232-8042 (medium) and 37395-7073 (higher/medium),” he added.
At the time of writing, spot gold last traded at $3,883.98 per ounce for a loss of 5.00% on the week but a gain of 0.19% on the day.
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