Gold price prediction today: Why gold prices are likely to be range-bound; check October 20, 2026 outlook
Spot gold is drawing some support from buoyant US treasuries and reduced possibility of October Fed rate hike.
Gold price prediction today:Gold prices are finding some support but the upside is capped by high crude oil prices, says Praveen Singh, Head Currencies and Commodities, Mirae Asset ShareKhan. Here’s his detailed analysis:
Gold Performance:
- Spot gold has traded in the narrow range of 4066-4226 in October.
- Despite a decline in oil prices on October 19, the shiny metal traded with a slight bearish tilt.
- At the time of writing this article on the night of October 19, the yellow metal was trading with a daily loss of ~0.5 % at $4142.
Oil and geopolitics:
- The US President Trump has delayed sanctions against Russia as wants to keep Russia engaged in peace negotiations with Ukraine. He also reasoned that as Russia has done little to assist Iran in the ongoing Iran conflict and kept diesel supply flowing amid the global diesel crunch, he is willing to give a leeway to Russia. He delayed the Lindsey O. Graham Sanctioning Russia and Iran Act of 2025 on Friday, two days before the sanctions were to come into effect.
- The US Administration stated that sanction relief will be in place for 60 days after which it would evaluate the impact on the US and global economies.
Brent oil prices were subdued on Monday after rallying 5% last week as traders assess improvement in Hormuz flows and possible escalation as the Middle East situation remains volatile. Major gains in Brent crude oil came on Friday on possibility of weekend escalation in geopolitical risks.- Russia and Ukraine continue to trade strikes despite Trump’s ceasefire declaration.
- US Energy Secretary Chris Wright said that Hormuz oil flows are now at 80% of the pre-war level, though product flows are constrained.
- At the time of writing this article on the night of October 19, were hovering around $109, down nearly 1% for the day. Weak-looking Brent oil futures erased most of the daily losses as Iran said that it has no other choice but to assert control over the Strait of Hormuz.
Gold ETFs :
- Total known global gold ETF holdings stood at 101.19 Moz, up 2.26% (2.24 MOz, or ~70 tons) YTD. Holdings are up 0.26 MOz (8.08 tons) since the beginning of the Iran war on February 28.
CFTC positioning :
- In the week ending October 13, money managers decreased their bullish gold bets by 3741 lots to 111,079 lots, the least bullish position in 18 weeks, according to the CFTC data.
- Long-only positions fell 1,705 lots to 128,542 lots, the lowest in 17 weeks.
- Short-only positions rose 2,036 lots to 17,463 lots, the highest in 12 weeks.
Data roundup:
- US NAHB Housing Price Index fell from 32 in September to 29 in October, the lowest since Jun 30, 2012. Confidence among homebuilders slumped due to high mortgage rates and elevated supply costs.
- US September CPI and PPI inflation data were hotter-than-expected.
October Fed rate hike probability:
- October Fed rate hike probability surged to 50% post US CPI data fell to 30% even after hot PPI report as US treasury yields sank on worries over AI stocks. The probability fell to 17% after Warsh’s speech in Bangkok.
Dollar Index and yields:
- The
US Dollar Index was slightly higher on October 19 as France’s government bond yields spiked higher and the spread between German and French yields widened to the highest closing level since 2012. French yields jumped as France imposed multiple curfews to contain intensifying riots. Cost-of-living protests in France could spread to other countries where elections are to be held next year. - Incidents of protests have been reported in Portugal, Italy, and Albania, too.
- At the time of writing this article on the night of October 19, the US Dollar Index at 101.98 was 0.10% higher for the day.
- Two-year yields at 4.78% were up 6 bps, while ten-year yields at 5.14% were up 1.3%.
- Apart from renewed European political and fiscal concerns, a sharp rally in Nasdaq also pushed yields higher, which weighed on gold.
- Last week, weakness in technology stocks triggered a sharp rally in US Treasuries that negated the impact of hot US inflation data. Yields were also pressured lower by Fed officials signalling the need for a pause in rate hike to assess the impact of the September rate hike before considering another increase in December.
- The US Dollar Index closed with a daily loss of 0.22% at 101.84 on Friday; it was down 0.40% in the week ending October 16.
- Two-year US yields have pulled back sharply from the cycle high of 4.96%, highest since April 2024, reached on September 29. Similarly, ten-year yields are down sharply from the decadal high of 5.36%
Central Bank watch:
- People’s Bank of China Governor Pan said on October 19 the central bank will monitor the impact of AI on the economy, financial markets, and monetary policy. He added that AI can boost investment and push up inflation in the short term before it enhances productivity that could lower the price growth in the medium term.
- China will announce 1-year and 5-year Loan Prime rates on October 20. The PBoC is expected to keep rates unchanged at 3% and 3.5%, respectively.
- The Fed Chair Kevin Warsh in his speech at IMF’s annual gathering in Bangkok on October 15 reiterated his commitment to price stability; however, sticking with his ‘no forward guidance’ policy, he did not give any clues about the Fed’s monetary policy trajectory. He did not show any urgency to act in the near term. He said AI remains the prime force supporting the global economy.
Upcoming data:
- Major US data on cards this week include weekly ADP employment change (October 20), September housing starts (October 20), pending home sales (October 20), September leading index (October 22), October prel. S&P Global US manufacturing, services and composite indices (October 23) and University of Michigan Sentiment and inflation expectations (October 23).
- Major Eurozone data include S&P Global Eurozone manufacturing, services, and composite PMIs (October 23).
- UK’s PMIs will also be released on October 23. The UK’s August job report (October 20) and September CPI (October 21) will also be on traders’ radar.
- Japan’s September national CPI and October preliminary PMIs data will be out on October 23.
Gold Price Outlook:
- Spot gold is drawing some support from buoyant US treasuries and reduced possibility of October Fed rate hike but high and rising oil prices cap the upside. At the same time, a convincing rebound in tech shares can also pressurize gold and treasuries.
- In the very short term, the shiny metal is expected to range trade with a limited upside. Rallies could be sold into, though selling at the lower end of the October range could be risky.
- Support is at 4100/4066/$4000. Resistance is at 4226/4280/$4335.
- In the coming days/weeks; however, the shiny metal is likely to come under intense selling pressure as crude oil can spike sharply higher with the approaching midterm US election on November 3. Tensions in the Middle East could escalate quickly in the wake of the US elections as Iran wants to keep oil prices as high as possible. In that case, a breach of support at $4066 could open the way to a test $3930 support. AI stocks also need to be monitored as the wobbly stock market could support the metal.
(Disclaimer: Recommendations and views on the stock market, or any other asset classes or personal finance management tips given by experts and analysts are their own. These opinions do not represent the views of The Times of India.)
