Only a dovish FOMC can boost gold, or sellers dominate?

This is the market's waiting phase. Gold has spent the past several sessions trading inside a broad consolidation while investors avoid taking aggressive positions ahead of tonight's FOMC rate decision, policy statement, and Fed Chair's press conference. The direction of the U.S. Dollar, Treasury yields, and Gold will likely be determined less by the rate decision itself and more by the Fed's forward guidance.

The market broadly expects the Fed to leave rates unchanged, but the key question is whether policymakers continue emphasizing inflation risks or begin signaling greater confidence that price pressures are easing. A hawkish tone could strengthen the Dollar and keep pressure on Gold, while a more dovish message may trigger a short-term relief rally. Until then, institutions are likely managing risk rather than building large directional positions.

From a technical perspective, Gold continues to trade inside a broad descending channel on the H2 timeframe. Every recovery toward the Demand + Trendline + Fibonacci resistance around 4055–4070 has been rejected, while buyers continue defending the 4020–4030 support area. This compression reflects a market waiting for a macro catalyst rather than committing to a trend.

As long as price remains below the descending trendline, the broader structure still favors sellers. The recent rebound appears corrective, and rallies into premium resistance continue to offer opportunities for selling rather than signaling a confirmed reversal.

PRIMARY SCENARIO

If the Fed maintains a restrictive tone, Gold is likely to remain below the descending trendline and resume its decline. A break beneath the 4020–4000 support zone could accelerate selling pressure toward the 3980 liquidity area, with the broader downside objective remaining in the 39xx region.

ALTERNATIVE SCENARIO

If the FOMC delivers a dovish surprise and Gold secures a confirmed H2 close above the 4055–4070 resistance cluster, buyers could extend the recovery toward 4090–4100. Even then, stronger confirmation would still be required before considering a medium-term trend reversal.

MARKET VIEW

Current Bias: Bearish

Preferred Strategy: Sell the Rally – Wait Confirmation

Trading Note: With the FOMC announcement approaching, volatility is expected to increase sharply. Rather than anticipating the outcome, waiting for post-news confirmation is likely to provide higher-quality opportunities. Lucas Gray Trading will continue monitoring macro developments and update the market as price structure evolves after the FOMC decision.

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