Go short on gold with $4,100 in view

The baseline scenario for gold is moderately bearish over the next two days, though sharp rebounds are still very much on the table. 

What is weighing on the precious metal? US yields and the dollar, plain and simple. Returns on 10‑ and 30‑year Treasuries have punched up to roughly 24‑year highs, making the opportunity cost of holding bullion painfully steep. In other words, bonds are offering a much sweeter deal right now. 

Concurrently, the greenback is holding firm. These two forces are drowning out some of the support that came from fading expectations of the Federal Reserve's (Fed) monetary tightening. After weak American jobs data, the odds of an October rate hike have tumbled, with the market placing them at around 23%. Why does this matter? Any pullback in yields or slip in the dollar could quickly send the XAUUSD pair bouncing back. Simply put, macro winds could shift on a dime.

Now, let's take a look at the technical picture. The nearest key support sits at $4,100–$4,110. A daily close below this level would be a red flag for bulls, clearing the way to $4,050 and potentially to the $4,000 zone. On the other hand, a push back above $4,150–$4,170 could be the first signal that sellers are losing their grip. A real upward reversal would only be in play once the price plants itself above $4,200–$4,230. Current market valuations also point to resistance near $4,230 and support just above $4,100.

But here's what could shake things up. A key risk to the bearish case lands on Wednesday, October 7. This is when the latest Federal Open Market Committee (FOMC) minutes drop. On top of that, Christopher Waller will deliver a speech the day after that. So, how the market digests American rates and Fed commentary will likely set the tone for the second half of this two‑day stretch. In short, expect a slight tilt toward further downside over the next couple of days. The most likely path is a test of $4,100, which could be followed by a strong technical bounce.

The ultimate recommendation is to sell gold. Place Take Profit at $4,100. Set Stop Loss at $4,140

Calculate your open position so that a potential loss (protected by a Stop Loss order) is limited to 1% of your deposit. If your account balance does not allow you to enter a position of this size, it is better to skip the trade and wait for other market signals that meet low-risk criteria.