Gold slides toward 4.5% weekly loss as dollar hits 19-month high

Gold prices are trading near 3,845 as the metal continues a bearish auction, extending losses away from higher distribution levels. The decline marks a roughly 4.5% weekly drop, the steepest retreat for the non-yielding asset in approximately four months.

Market participants are recalibrating interest rate expectations following recent economic data. While October U.S. producer prices rose 0.3% month-on-month—slightly trailing the 0.4% forecast—annual producer inflation accelerated to 6.5%, the highest level since November 2022. Investors have pared back bets for a 50 basis point rate hike in December, though markets still price in a 91.4% probability of a 25 basis point increase.

Broader financial conditions remain unfavorable for gold, with the dollar reaching a 19-month high. Two-year Treasury yields also recorded their largest weekly increase in more than two years, further pressuring the metal. Current trade between 3,835 and 3,855 reflects active lower-price discovery, with sellers maintaining dominance as the market migrates away from abandoned higher price zones.

Value reclaim and support levels

Technical analysis suggests a potential responsive rotation toward Technical analysis suggests a potential responsive rotation toward the 3,885–3,905 range, which serves as the first area for a value reclaim. Analysts note that a rebound to this zone would not necessarily signal a reversal of the bearish trend.

If the market fails to sustain trade above 3,860, higher prices are likely to face rejection, keeping the auction anchored to lower value.

Immediate support is identified at the 3,815–3,830 level. Should the market fail to rebuild value above the reclaim zone, the deeper 3,735–3,755 range remains exposed as the major lower value area. A shift in the current bearish imbalance would only occur if the market successfully reclaims the 3,885–3,905 region and maintains sustained acceptance above it.