WGC: Gold Faces Critical $3,858 Support Amid Fed Policy Uncertainty
Gold | 2026-11-03 05:34:53
Expectations of tighter monetary policy have improved the relative appeal of bonds, resulting in liquidation of gold positions by investors.
By Paul Ploumis
SEATTLE (Scrap Monster): Gold prices remained under pressure last week, mainly due to shifting expectations for U.S. monetary policy, investor positioning and broader financial market volatility, said the World Gold Council (WGC) in its latest Weekly Markets Monitor.
The LBMA Gold Price PM settled Friday at $3,913 per ounce, marking a weekly decline of 2.5%. Gold also slipped below the psychologically important level of $4,000 per ounce for the first time since mid-July. The yellow metal has lost 10.4% year-to-date, WGC report noted.
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According to the WGC, the latest weakness largely reflects a reassessment of the Federal Reserve's interest rate outlook following its October meeting. Expectations of tighter monetary policy have improved the relative appeal of bonds, resulting in liquidation of gold positions by investors.
Looking ahead, the WGC considers $3,858 per ounce a critical support level. A sustained break below this threshold could expose subsequent support at $3,820, followed by $3,605 and $3,500. On the upside, $4,083 represents initial resistance. A recovery above the 55-day moving average, currently around $4,275, would provide stronger evidence that a sustainable price recovery is developing.
The report identified U.S. midterm election results and October non-farm payrolls as the immediate market catalysts.
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What is the most likely direction for gold prices in the near term?
Frequently Asked Questions
- What was the LBMA Gold Price PM at the end of last week?
The LBMA Gold Price PM settled at $3,913 per ounce on Friday, marking a weekly decline of 2.5%. Gold also fell below the $4,000-per-ounce threshold for the first time since mid-July, with year-to-date losses reaching 10.4%.
- Why did gold prices decline last week?
According to the World Gold Council, gold prices weakened primarily due to changing expectations for U.S. monetary policy following the Federal Reserve's October meeting. Expectations of tighter monetary policy increased the relative appeal of bonds, encouraging investors to reduce their gold holdings.
- What are the key support and resistance levels for gold prices?
The WGC considers $3,858 per ounce a critical support level. A sustained break below it could expose gold to further support at $3,820, $3,605 and $3,500. On the upside, $4,083 represents initial resistance, while the 55-day moving average near $4,275 is an important recovery threshold.