Gold Holds Above $4,300 as Markets Eye Fed and US-Iran

Key Moments

Gold Steady but Subdued Ahead of FOMC

Gold (XAU/USD) trades in a tight range heading into the European session on Wednesday, staying under pressure but avoiding heavy selling and holding comfortably above the $4,300 level. Market participants appear reluctant to build strong directional positions before the closely watched Federal Open Market Committee (FOMC) policy announcement, leaving the metal below both the weekly high set on Monday and the key 200-day Simple Moving Average (SMA). At the same time, support for gold is emerging from a softer US Dollar (USD), which has been undermined by renewed optimism surrounding an interim US-Iran peace arrangement.

US-Iran Framework Deal Tempers Safe-Haven Flows

The United States and Iran have agreed to a framework peace deal designed to halt the conflict that started earlier in 2026. The initial memorandum of understanding (MOU) calls for a 60-day ceasefire, reopening of the Strait of Hormuz, and the launch of technical talks on Iran’s nuclear program. Beyond that, information remains limited, with conflicting statements on the scope of the agreement.

According to the article, US President Donald Trump said that the MoU will state that Tehran will never have a nuclear weapon, while Iranian state media reported that the country had not yet entered detailed negotiations on nuclear questions. Additional reports indicate the framework includes plans for a $300 billion private investment fund for Iran, but Trump described that element as “fake news.” These uncertainties are preventing investors from taking aggressive short USD positions ahead of the Federal Reserve announcement, even as the deal narrative pressures the currency’s safe-haven appeal.

Fed Decision in Focus: Rates, Bias, and Projections

The US Federal Reserve is scheduled to release its interest rate decision later today and is widely expected to keep policy rates unchanged. At the same time, the central bank is anticipated to remove its easing bias, in response to inflation that has been more persistent than previously expected. Market attention will therefore center on the updated economic projections, including the so-called dot plot, for guidance on the future rate path.

Investors will also be closely watching the post-meeting press conference by new Fed Chair Kevin Warsh for additional signals on policy direction. In recent sessions, markets have been unwinding the worst-case inflation and hawkish Fed scenarios that were priced in during the height of the US-Iran conflict. Nonetheless, traders are still assigning around a 60% probability that the Fed will raise rates by 25 basis points (bps) in December. As a result, a clear dovish shift from the Fed would likely be required before traders become comfortable re-establishing more forceful bearish positions on the USD and looking for a sustained extension of gold’s rebound from the year-to-date low seen last week.

Technical Picture: Key Levels for XAU/USD

From a chart perspective, XAU/USD remains constrained near the 38.2% Fibonacci retracement of the April-June decline and below the downward-sloping 200-day SMA, which together maintain a broadly bearish backdrop. The Relative Strength Index (RSI) sits around 44, while the Moving Average Convergence Divergence (MACD) indicator shows a slightly positive reading, suggesting stabilizing, but not yet robust, upside momentum.

Any further advance is likely to encounter initial resistance near $4,400, ahead of a more significant confluence in the $4,445-$4,450 region, where the 50% Fibonacci retracement level aligns with the 200-day SMA. A daily close above this zone would be required to ease downside pressure and clear the way toward the 61.8% retracement around $4,560, followed by additional Fibonacci barriers at $4,707 and $4,893.

On the downside, immediate support is seen at the 23.6% retracement near $4,227, with a more important structural base located at the recent swing low around $4,022. A break below that floor would reinforce the prevailing bearish stance and open the door to deeper losses.