In early Asian trading on Wednesday (October 29), spot gold hovered near a three-week low, currently trading around $3,940 per ounce. On Tuesday, spot gold hit an intraday low of $3,886.51, its lowest level since October 6, before closing down 0.7% at $3,952.54 per ounce. Optimism surrounding Sino-US trade has dampened gold's appeal as a traditional safe-haven asset.

Investors are closely watching the Federal Reserve's two-day policy meeting, with Wednesday's interest rate decision becoming the focus of the market. The Fed is widely expected to cut interest rates by 25 basis points, and the CME FedWatch tool indicates a greater than 90% probability of another rate cut in December. In theory, a rate cut should benefit gold by reducing holding costs and stimulating demand for non-yielding assets.

Looking at the daily spot gold chart, following a gap-down open on Monday, the market is currently experiencing a volatile correction. The key support level remains at 4000. A break below this level could accelerate the decline. Currently, the short-term moving averages are in a bearish formation. With the MA20 level already broken, the MA40 level will likely be the next support level. Furthermore, the MACD indicator is also forming a death cross. Therefore, a resumption of the upward trend will depend on tonight's Federal Reserve meeting.

Looking at the 4-hour spot gold chart, with further volatile declines, the 4000 level has been breached. While the overall decline has not yet fully unfolded due to significant news tonight, the pace of the trend has clearly shifted. The current bearish formation of the moving averages suggests potential short-term pressure in the latter half of the term. The MACD indicator is also trading below the 0 axis. For the time being, we recommend shorting on rallies. Resistance levels: 3980-3990-4000. Support levels: 3965-3950-3940.

Disclaimer: The article is contributed by the market analyst from Bitop market observation team. The content is solely for personal opinions and sharing. The analysis is time-sensitive and provided for reference and discussion only. It does not constitute any investment advice. The market is risky, so investing should be done cautiously.