Gold Price Analysis and Market Drivers on November 7

Price Movement and Technical Levels: Reading the Current Balance

Since the opening of trading on Friday, the gold market has experienced a positive start exceeding the $3,996 per ounce range, supported by a simultaneous decline in the US dollar, which lost about 0.5% of its gains after reaching a four-month high. The spot contracts increased by 0.5%, and December futures approached the $4,004 level, indicating the market’s attempt to establish a new stability base before any broader move.

From a technical perspective, gold maintains its position above the critical support level at $3,928, a barrier that has repeatedly proven capable of halting the recent downward wave. Resistance remains strong at $4,046, and surpassing this level is considered a necessary condition to regain momentum toward $4,100 and $4,150. The Relative Strength Index (RSI) shows a moderate recovery at 53, suggesting that the market has not yet reached overbought conditions, leaving room for continued potential gains without forced selling pressures.

Decline in the Dollar and Bond Yields: Improving Gold Conditions

The current rise in gold is directly linked to the decline in the dollar index after testing a peak, as foreign portfolios began re-accumulating gold after a depletion phase caused by the strength of the US currency. This movement coincided with a noticeable drop in 10-year bond yields, signaling that the market is reassessing the economy’s resilience in light of recent developments in the employment market.

This combination of dollar weakness and falling yields creates a favorable environment for gold as a safe haven, especially since it is an unrealized asset benefiting from expectations of future interest rate cuts. Each of these factors alone can support the price; together, they significantly enhance the upward momentum.

Employment Market Data and Growing Concerns of Economic Slowdown

Strong indicators of a faster-than-expected weakening in the US labor market have emerged. Recent figures show job losses in October, particularly in government and retail sectors, while layoff plans increased by over 150,000 jobs, the highest rise in more than twenty years.

This sharp decline in employment activity pushed markets to raise expectations of a December rate cut to around 69%, up from 60% in the previous session, reflecting a rapid shift in expectations regarding monetary policy paths. In such an environment, gold finds a clear area of strength, as the cost of holding it decreases relatively, and safe-haven demand rises amid growing economic uncertainty.

Long Government Shutdown: An Additional Source of Uncertainty

The ongoing government shutdown for 37 days so far has forced markets to heavily rely on private sector data, with many official statistics absent. This situation is not just an administrative complication but also significantly impacts economic and monetary decisions, especially as some vital sectors like civil aviation reduce operational capacities.

This uncertainty boosts demand for defensive assets, foremost among them gold as a store of value during times of uncertainty. Any additional complication could further deepen this trend.

Stock Market Pressures and Liquidity Reallocation

Global stock markets faced a clear wave of pressure during Friday’s trading, amid rising concerns about monetary policy outlooks. Despite positive hints from the Federal Reserve in its recent meeting, weak employment data this week renewed doubts about the central bank’s ability to proceed with the previously expected rate cuts.

This contradiction was reflected in investor behavior, who began reducing exposure to riskier assets, especially technology stocks. This was evident in the decline of Wall Street indices at the open, with clear selling pressures on the technology and AI sectors.

This decline followed strong upward waves that extended US stocks in recent months, leading investors to believe that current valuations require a more flexible monetary environment and stronger economic growth to justify them. With this current lack of confirmation, profit-taking and reallocation movements have begun.

Investment Accounts and Financial Commitments: A Point of Consideration

Among the decisions investors make when rebalancing their portfolios is considering various financial obligations, including zakat on trade assets and investment portfolios. These considerations influence the timing of rebalancing and the assets chosen, which may partly reflect current movements toward safe havens.

Geopolitical Risks and Renewed Demand for Hedging

Geopolitical issues remain a key factor in shaping global market sentiment, especially as some regional tensions enter sensitive phases recently. Although the impact has not reached the level of direct shocks, it has been sufficient to reallocate some liquidity toward safe assets, primarily gold.

Investors realize that any disturbance in strategic regions could reignite inflation, a scenario central banks aim to avoid. Therefore, major portfolios tend to increase their proportion of defensive assets at the first sign of rising risks, as a protective measure to preserve value rather than seeking quick profits.

Price Ranges and Critical Levels

Monitoring Support Levels:

• $3,985
• $3,935
• $3,886

Monitoring Resistance Levels:

• $4,046
• $4,100
• $4,150

Prices are currently moving within a sideways range between $3,975 and $4,046 on the four-hour timeframe, reflecting a clear state of anticipation before new economic catalysts.

Short-term Outlook

Technical indicators on the medium-term frame suggest the beginning of a recovery in momentum, with moving averages trending toward a potential bullish rebound. Trading volume remains relatively limited, indicating markets are awaiting larger data and catalysts before establishing strong positions.

Holding above $4,046 opens the way toward $4,100 and then $4,150, while a break below $3,985 could push the price toward $3,935, the barrier that will determine whether the current correction is healthy or the start of a deeper decline toward $3,886.

Gold’s continued role as a preferred safe haven remains evident, but the upward path requires confirmation through surpassing key resistances that have capped the price since the beginning of the week.

Performance of Other Precious Metals and Sector Dynamics

There is no widespread buying flow across precious metals in general, with the rise concentrated solely in gold driven by macroeconomic factors. This reflects that gold’s movement is driven by safe-haven demand rather than broad industrial or investment momentum in the sector.

Technically, silver remains stuck below a key resistance near $49, and a breakout would be considered a confidence signal of continued fund inflows into metals. Platinum needs to defend support at $1,500 to avoid a deeper decline.

Price dispersion within the metals group places gold at the forefront as the primary safe-haven asset at this stage, being the least concerning and most responsive to macroeconomic factors.