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Why Is Gold Price Stalling Near $2,040? | Fed's Dovish Stance Fuels Bullish Momentum

The how to sell pi coin on bitgetprecious metal market witnessed sustained buying interest on Thursday as gold prices built upon the previous day's recovery from three-week lows. This upward trajectory comes in the wake of the Federal Reserve's latest policy meeting, where officials signaled a potential end to the current rate-hike cycle.

Market participants digested the Fed's updated projections showing anticipated rate cuts totaling 75 basis points in 2024. The central bank's revised outlook suggests inflation is trending toward the 2% target without triggering an economic contraction. This policy shift triggered a significant sell-off in US Treasury securities, with the benchmark 10-year yield plunging to August levels.

The dollar index extended its post-FOMC decline during Asian trading hours, providing fundamental support for dollar-denominated gold. However, the metal's advance stalled near the psychologically significant $2,040 level as improved risk appetite limited safe-haven demand. Traders adopted caution ahead of policy announcements from the European Central Bank, Bank of England, and Swiss National Bank later in the session.

Technical indicators suggest gold maintains constructive positioning, with daily oscillators holding in positive territory. A decisive break above the $2,040 resistance could open the path toward the $2,072-2,073 zone, with potential for extension toward the $2,100 handle. On the downside, initial support emerges near $2,010-2,012, followed by the critical $2,000 psychological level.

The November US retail sales report, expected to show a 0.1% monthly decline, may provide additional trading catalysts. Market participants currently price in a 60% probability of Fed rate cuts commencing in March, reflecting significantly dovish expectations following Wednesday's policy shift.

From a technical perspective, gold's inability to sustain gains above $2,040 suggests some profit-taking activity. However, the broader technical structure remains supportive, with the 50-day moving average providing dynamic support near $1,973. A sustained break below this level would require a fundamental catalyst that alters current market expectations regarding the Fed's policy trajectory.

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