Spot Gold Tests $4,380 Intraday as 1-Hour Moving Averages Entangle in Consolidation
Following four consecutive weeks of corrective pullbacks, the global precious metals market posted a weekly gain. On September 18, spot gold advanced to nearly a one-week high, breaking through the pivotal $4,350 overhead resistance zone. During Asian trading on September 21, spot gold consolidated firmly above the $4,370 mark.
Intraday, spot gold traded at $4,375.08/oz, down slightly by 0.06% on the day, having touched a high of $4,383.40 against a session low of $4,358.60. The 1-hour technical setup reveals an interwoven moving average formation indicative of range-bound consolidation, with the MA1 at 4,373.15, MA20 at 4,377.85, and MA30 at 4,376.27.
Federal Reserve Delivers 25 bps Hike as Treasury Yield Curve Flattens Further
At its most recent monetary policy meeting, the Federal Reserve lifted its benchmark policy rate by 25 basis points to a target range of 3.75%-4.00%. CME FedWatch metrics show traders are pricing an estimated 53% probability of another rate hike in October, with the odds of at least one additional hike before year-end standing at 90%.
In sovereign debt markets, the US 2-year Treasury yield climbed to levels unseen since July 2024, while the benchmark 10-year yield hovered near 5.00%. Consequently, the 2-year/10-year yield spread compressed to 23.8 basis points, setting the flattest curve profile since June 25. Overseas, the Bank of Japan concurrently raised its benchmark rate to its highest level in 31 years.
Middle East Tensions Threaten Strategic Energy Infrastructure
Regional geopolitical friction in the Middle East saw fresh escalations over the weekend. Armed factions announced two targeted operations aimed at sensitive installations near Saudi Arabia's capital and key energy infrastructure in Yanbu. Saudi forces responded with sustained aerial operations, exceeding 760 cumulative missions. Additionally, Iranian military sources reported shooting down an aerial reconnaissance drone over the Strait of Hormuz corridor.
Institutional Bullish Consensus Emerges Ahead of Pivotal Macro Releases
Market sentiment surrounding bullion's near-term outlook reflects an unusually strong consensus. In the latest Kitco Weekly Gold Survey, 100% of the 16 participating Wall Street analysts forecasted gold prices would extend their upward trajectory this week, with 58% of general respondents projecting gains, 24% anticipating declines, and 19% looking for sideways consolidation. Global markets face a heavy slate of macroeconomic releases this week, including PMIs across major European and US economies, initial jobless claims, and durable goods orders.
Furthermore, multiple central banks are slated to announce policy decisions alongside speeches from prominent Federal Reserve officials, providing crucial directional impetus as bullion tests key resistance between $4,400 and $4,440.