Gold Faces Pressure as Central Banks Could Ease Buying Soon | Investing.com UK
Gold sits at a delicate balance near all-time highs, with markets parsing a flurry of geopolitical developments and shifting macro signals. After a dramatic probe of record levels on October 20, 2025, momentum has cooled, and traders are weighing whether the metal is primed for a deeper pullback—especially if official-sector demand starts to ease.
Geopolitics keep the spotlight on safe havens
Risk sentiment opened the week on edge amid jitters around the Israel–Hamas ceasefire following weekend violence. Signals from Israel suggested the truce was still holding and humanitarian aid to Gaza would resume, helping pare some of the immediate haven rush.
Attention also turned to Washington’s latest attempts to facilitate a Russia–Ukraine ceasefire. Over the weekend, reports indicated a meeting between Donald Trump and Ukrainian President Volodymyr Zelensky, with suggestions Trump urged Kyiv to concede territory and declined certain military assistance. Layer on U.S. fiscal concerns and the specter of a government shutdown, and the macro backdrop remains a cocktail of uncertainty—one that typically supports gold, even as positioning looks stretched.
Could central banks tap the brakes?
One critical swing factor ahead: the pace of central bank bullion purchases. If geopolitical heat turns down even slightly, some official buyers may step back or slow accumulation. That shift would trim a key pillar of demand that helped propel prices to fresh highs. The softening seen late last week as profit-taking hit record territory showcased how quickly sentiment can turn when a dominant bid starts to fade.
Cross-asset flows: Bitcoin on the radar
Another element in the mix is the potential rotation into digital assets. Bitcoin is attempting to defend its 200-day moving average near $107,752, with a secondary support area around $103,886 where dip-buyers have been active historically. If crypto stabilizes and attracts fresh inflows, some capital currently parked in gold as a safety trade could drift toward higher-beta alternatives.
Price action: levels that matter
Weekly view: The latest candle resembles an exhaustion-style hammer after tagging a record near $4,309, hinting that bullish energy may be waning. A decisive break beneath $4,216 would strengthen the case for a multi-week retracement, opening a path toward the 9-DMA around $3,858.
Daily view: Immediate support sits near $4,229. A clean breach would expose the 9-DMA around $4,183, a zone that could come into play within the current session if selling accelerates.
Hourly view: The contract has already slipped under its 100-DMA near $4,288.89, which puts the 200-DMA around $4,183.55 squarely in focus. A sustained move below the 200-DMA over the next session or two would likely flip momentum firmly bearish and encourage momentum sellers to press the downside.
What could flip the script
- Durability of Middle East ceasefire arrangements and the tempo of Gaza aid deliveries.
- Any concrete progress—or setbacks—around a Russia–Ukraine ceasefire push.
- Signals from central banks regarding reserve diversification and gold buying pace.
- U.S. fiscal headlines and the path of a potential government shutdown.
- Whether Bitcoin holds its 200-DMA, potentially siphoning risk capital from gold.
- Price behavior around $4,229, $4,216, and the $4,183–$4,183.55 cluster of supports.
Bottom line: The market’s narrative is shifting from relentless haven demand to a more nuanced tug-of-war between geopolitics, central bank flows, and technical gravity. If official-sector appetite cools and key supports give way, a deeper retracement from the highs becomes the path of least resistance. Conversely, any fresh flare-up in global risks or renewed central bank accumulation could quickly put new records back on the table.
Disclaimer: This article reflects market observations and does not constitute investment advice. Trading in gold and other assets involves risk, and decisions should be made at your own discretion.
