Evaluating the movements of on different time chart patterns since the beginning of this year, I anticipate gold futures are ready to reverse from the tested record highs this week. Investors remain cautious as persistent fiscal strains and rising global tensions over trade and national security continue to be key issues for the Trump administration.
Gold bugs continue to broadly anticipate a shallow easing cycle from the Fed. Labor market conditions remain stable; inflation shows signs of peaking, and the Fed funds rate moves closer to a neutral level, one viewed as neither restrictive nor accommodative.
US rate futures have priced in about 44 basis points of easing, or less than two 25-basis-point cuts, for 2026. That pricing was down from about 53 bps two weeks ago.
I find that gold futures could face extensive bearish pressure this week as investors brace for an extended pause in the Federal Reserve’s rate-cutting cycle, as they edge into slightly riskier trades, driven by a resilient economy and fresh fiscal stimulus plans that are likely to boost consumer spending this year.
The U.S. central bank’s Federal Open Market Committee (FOMC) is widely anticipated to hold its benchmark interest rate steady in the 3.50%-3.75% target range at the end of a two-day policy meeting on Wednesday.
Undoubtedly, the committee cut the rates by a quarter of a percentage point at its meetings in September, October, and December following a nine-month pause last year.
Whatever signals Fed Chair Jerome Powell gives at his press conference on Wednesday about the speed of rate cuts, investors’ focus will likely shift to who might replace him in May this year.
Ahead of the Fed decision, gold futures are trying to hold near the tested highs this week despite surging bearish pressure, reflecting how sensitive they could be to changes in interest rates, where the futures guidance on future rate cuts matters a lot to take a decisive move soon, as they sense the final outcome from the Fed.
Technical Levels to Watch
In a daily chart, gold futures are trying to sustain above the significant resistance at $5,113 after testing the day’s low at $5047.16, could test the next resistance at $5,143.15 and 5,168.93, where a breakout above this could push the gold futures to test the next significant resistance at $5,248.54 this week. Though bullish momentum still looks intact, any attempt to test these resistances could trigger heavy selling, too.
Inversely, if the gold futures find a breakdown below the immediate support at $5,027, could test the next significant support at the 9 EMA ($4,899), where a breakdown could push the futures to test the next support at the 20 EMA ($4,717) as the slide could turn steeper below this support on Wednesday.
In a weekly chart, gold futures are trading at a pivotal point where the extreme bearish pressure could evaporate all the weekly gains, after testing this week’s high at $5,145.39, trading at $5,111, indicating the level of extreme indecisiveness before the Fed’s decision on Wednesday.
Undoubtedly, the gold futures are trading much above the immediate support at $4,714 in the weekly chart extend doubts about the strength of this move, which is likely to attract big bears to start selling at any time.
In a monthly chart, gold futures have formed an extremely large bullish candle this month, since the advent of this rally in September 2025. While all the monthly candles of this uptrend were normal in size, raising skepticism over the length of this month’s candle, looking ready to shed some gains this month itself.
Disclaimer: Readers are advised to take any position in gold at their own risk, as this analysis is based only on observations.
