Gold Pullback Risk Builds as Bearish Patterns Form Ahead of Fed

Gold is reversing, currently trading around the $4,850 level as markets wait for major central bank decisions, especially the Fed. Traders are cautious, with no strong moves as uncertainty remains high.

The Fed is expected to stay somewhat hawkish, with inflation still a concern, even though no rate hike is expected. This is limiting gold’s upside, as tighter policy can be negative for gold.

From a technical view, $4,800 is acting as a key level, with strong support seen around $4,600 if the price moves lower. On the weekly chart, gold has made a three-inside-down pattern (bearish). A bearish three black crows pattern is forming. If this week’s candle closes stronger than last week’s bearish candle, the pattern will be confirmed and a deeper pullback could follow.

Gold Weekly Chart

Overall, gold still has a bullish outlook, but in the short term, a pullback is possible towards $4,600 until there is more clarity from central banks and the direction of monetary policy.