Gold Bounces to $3,946 Then Slips Below $3,950 as Strong US Factory Data Fuels Fed Hike Bets
Gold staged a sharp rebound from a one-year low on Monday — then gave part of it back on Tuesday as hot factory data reminded traders the Fed is not done yet
Gold's round trip this week is a textbook case of two forces pulling the same asset in opposite directions. On Monday, gold rose 1.82% to $3,945.88, its first higher close after three lower ones, rebounding from a one-year low near $3,870 as plunging oil prices and US-Iran diplomacy hopes eased geopolitical risk. By Tuesday's Asian session, gold had slipped back below $3,950, trading around $3,914–$3,929, after US manufacturing data came in stronger than expected and revived bets on a December Federal Reserve rate hike. The metal remains well below the $4,000 psychological level it closed above four times last week — and the tug-of-war between safe-haven demand and higher-for-longer rates is far from settled.
- Monday's bounce: oil down, gold up, dollar mixed
Monday's rebound had a clear trigger: crude oil's plunge of more than 7% reduced fears of prolonged energy disruption, and gold — which had been sold alongside everything else in the risk-off unwind — found buyers near its lows. The bounce, however, was uneven across currencies. The dollar closed lower against the euro, the pound and the Swiss franc but higher elsewhere: EUR/USD rose 0.24% to 1.11867, USD/CHF fell 0.76% to 0.81872, while USD/JPY rose 0.24% to 157.935, its fifth straight close above 157.50, despite a fresh intervention warning from Japan's Finance Minister Satsuki Katayama. AUD/USD fell 0.48% to 0.69973, its first close below 0.70 since October 19, ahead of the Reserve Bank of Australia's decision — which then delivered a 25-basis-point hike to 4.85%, an 18-year high, on a 6–3 vote. Silver joined the rebound, rising 2.74% to $50.48, back above $50. For forex beginners, our leverage and margin guide is here: https://zimbuck.com/blogs/922/What-Is-Leverage-and-Margin-in-Forex-A-Beginner-s — and the Zimbuck News page is here: https://zimbuck.com/pages/zimbucknews with discussion at https://zimbuck.com/groups/zimbuckmarketnews .
2. Tuesday's reversal: hot factory data, higher yields, election caution
The Institute for Supply Management's Manufacturing PMI rose to 55.5 in October from 54.5, beating consensus and marking a tenth straight month of expansion. Stronger factory activity bolstered hawkish Fed expectations and lifted bond yields, pressuring non-yielding gold. The dollar, however, struggled to attract buyers: traders are broadly hesitant ahead of Tuesday's US midterm elections, which decide control of Congress, and ahead of the September JOLTS job-openings data due later in the North American session. Technically, gold holds a bearish near-term bias beneath the 100-period exponential moving average on the 4-hour chart, with immediate resistance at the 100-period EMA near $4,053 and support around Friday's swing low near $3,870 — a break below which would extend the downtrend, while a decisive move above $4,000 could open the way toward $4,062 and $4,218. The key levels to watch this week:
Support: $3,870 (Friday's low) — then $3,850, $3,800, $3,700.Resistance: $3,975–$4,010 — then $4,053 (100-period EMA) and $4,106.Events: US midterms and JOLTS today; Treasury refunding and ADP Wednesday; Bank of England Thursday; nonfarm payrolls Friday.Dollar context: DXY around 101.74, 10-year yield near 4.91%.
FAQ
Why did gold bounce on Monday? Plunging oil prices on US-Iran diplomacy hopes eased geopolitical risk, and buyers stepped in near gold's one-year low around $3,870.Why did it slip back on Tuesday? Stronger-than-expected US manufacturing data (ISM PMI 55.5) revived December Fed hike bets and lifted bond yields, pressuring non-yielding gold.What is the key level for gold now? $4,000 — gold closed above it four times last week but now trades below it; a decisive break above could target $4,062.Where is support if gold falls again? Around $3,870, Friday's swing low, then $3,850 and $3,800.How does the RBA hike fit in? The Reserve Bank of Australia raised rates 25 bps to 4.85%, an 18-year high, which weighed on AUD/USD below 0.70 even as gold bounced.
Source for this story: TalkMarkets, Gold Struggles Below $3,950 Amid Fed Hike Bets, Ahead Of US Midterm Elections, November 3, 2026, https://talkmarkets.com/article/gold-struggles-below-3950-amid-fed-hike-bets-ahead-of-us-midterm-elections . This is market news and general information only, not financial advice. Join Zimbuck at https://zimbuck.com to follow more forex and gold coverage.
