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Asset Watch
Wednesday, 22 October 2025
Gold prices retreated from their record highs near $4,380/oz, bouncing back around the $4,000 level amid several factors. These include a stronger U.S. dollar and market caution ahead of the Federal Reserve meeting later this month, where the Fed is expected to cut interest rates by 25 basis points. However, policymakers may signal the possibility of fewer rate cuts than markets anticipate or a slower pace of easing starting next year, depending on incoming economic data.
After testing the $4,000 support, gold rebounded above $4,100 as investors resumed buying amid persistent uncertainty (the same factor that initially fueled the rally). This includes ongoing geopolitical tensions, concerns about U.S.–China relations that remain fragile and could escalate into a trade war, continued central bank demand for gold, and fears of rising global inflation, which could lead to lower real interest rates (nominal rates minus annual inflation).
Gold prices rose earlier this week but failed to test the $4,400 handle, then fell in yesterday’s session due to profit-taking. Yesterday’s daily candle closed with a Bearish Engulfing pattern, signaling a potential reversal. If today’s daily close falls below $4,000/oz, further declines toward $3,800 would likely follow. In this scenario, the $3,900 support level should be closely monitored.
If gold resumes its upward momentum and the daily candle stick closes above $4,400, this will indicate renewed bullish strength as traders re-enter the market, potentially driving higher prices toward $4,500/oz.
Chart Source: ADSS Platform
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