Gold is entering the Fed decision with a very different structure than it had a few weeks ago.
Spot gold is trading around $4,290/oz, after falling to a more than one-month low. Monday’s spot close was around $4,312.59, down 0.8%, while today gold has remained under $4,300 as the dollar and Treasury yields continue to pressure the metal.

The short-term trend is clearly weaker. Gold rebounded more than 1% on Friday toward $4,363, but that recovery failed to hold. The market then rolled over again after inflation and oil pushed Fed-hike expectations higher. From the September 8 close near $4,355 to around $4,298 now, gold is roughly 1.3% lower over the last week.

What matters to me here is the reaction around $4,300. This is both a psychological level and the area where buyers need to prove they are still willing to defend the dip. Below it, $4,250–$4,280 becomes the next important demand zone. A clean break through that area would tell me the current correction is becoming more than a simple pullback.

On the upside, $4,350–$4,365 is the first recovery zone. Gold traded around $4,363 after Friday’s rebound, so reclaiming that area would show that buyers are starting to absorb the recent selling. Above $4,400, the structure would improve considerably because price would be back above the recent breakdown area.

The bigger resistance remains around $4,450–$4,500. That is where I would expect sellers to become active again unless yields and the dollar start falling. I would not call a move through $4,400 a full reversal by itself; I want to see acceptance above the zone rather than one fast wick.

The derivatives picture also needs some caution. I cannot verify a reliable live XAU/USD funding rate or centralized 24-hour open-interest figure, so I won't manufacture one. The latest World Gold Council positioning data is still useful, though: COMEX net longs increased sharply during August, reaching 753 tonnes, while managed-money net longs reached 470 tonnes. That tells me positioning had become meaningfully long before this latest macro-driven decline.

There is still strong underlying investment demand. Global physically backed gold ETFs added $18 billion in August, while holdings climbed by 121 tonnes to a record 4,189 tonnes. Gold-market activity also averaged roughly $430 billion per day in August. So the current weakness is not happening because the long-term demand story suddenly disappeared.

The immediate catalyst is macro.

August CPI came in at 0.4% MoM, stronger than July, while rising oil prices are adding another inflation problem. Brent is now around $107, after attacks disrupted Saudi energy infrastructure. At the same time, the 10-year Treasury yield moved above 5% and the dollar reached a two-week high. All three are working against gold in the short term.

And now comes the main event: the Fed.

Markets are pricing roughly a 93% probability of a 25 bp hike, while the latest Reuters economist poll showed 85% expecting the Fed to move rates to 3.75%–4.00%. The hike itself may already be priced in. For gold, the bigger risk is the Fed's guidance about what happens next.

My bullish scenario is simple: gold needs to reclaim $4,365, then hold above $4,400. If that happens with falling yields and a weaker dollar, I would look toward $4,450 and $4,500. A sustained move back below $4,300 would invalidate that recovery setup.

The bearish scenario starts with a clean break below $4,250. That would open the door toward $4,200, with $4,100 becoming the next major downside area if selling accelerates. A reclaim of $4,365 would weaken that bearish setup, while a move back above $4,400 would make me much less interested in chasing shorts.

My verdict: gold is in correction, not confirmed reversal yet.

The long-term demand picture remains strong, but the short-term structure favors consolidation-to-bearish pressure until gold can reclaim $4,365–$4,400.

For me, the next trade is not about guessing Powell.

It is about watching $4,300, Treasury yields and the dollar together.

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