GLD ETF analysis: Here’s what to expect ahead of the December Fed meeting

GLD gold ETF ended last week in the red as Treasury yields edged higher ahead of the highly anticipated December Fed meeting. Despite the differing opinions among the US central bank officials, investors have become increasingly confident that the Fed will announce a quarter-basis-point interest rate cut during the meeting slated for 9th-10th December. 

Beyond that decision, financial markets will be keen on the FOMC statement for cues on what lies ahead. At the time of writing, the bullion was trading at $4,197 an ounce as the bulls lacked enough momentum to sustain its intraday move above the crucial zone of $4,250. 

Gold price analysis ahead of Fed meeting

A weaker US dollar, higher Treasury yields, and a wait-and-see approach have sustained gold price within a tight range in recent sessions as financial markets eye the last Fed meeting of the year. 

In past meetings, the central bank has maintained that its decisions will be informed by the released economic data. However, following the prolonged US government shutdown, the picture of the country’s economy is rather incomplete.

Even so, investors are increasingly confident that the Fed will lower interest rates by 25 basis points at the upcoming meeting. Beyond that decision, the focus will be on the central bank’s statement regarding the coming months. A hawkish tone would limit gold’s upside potential while strengthening the US dollar. 

At the same time, investors are already assessing the drivers in the coming year. In its forecast for 2026, the World Gold Council (WGC) notes that economic uncertainties and market volatility will continue to impact gold prices. The council paints three possible scenarios, which include an intense global downturn, slight slipping of the US labor market, or Trump’s unorthodox policies sparking stronger-than-expected growth. 

In the first two instances, a slowing US job market and easing consumer activity may push policymakers to lower interest rates further. Additionally, central bank buying, a softer US dollar, and a Fed Chair who favors lower interest rates, may bolster gold price to new highs. 

In contrast, signs that Trump’s policies are fueling higher-than-expected economic growth would strengthen the US dollar while lowering the precious metals’ safe-haven appeal.  

GLD ETF technical analysis

GLD gold ETF recorded a weekly loss after trading in the green over the past three weeks. It has ended in the red for four out of this week’s five trading sessions despite the steady support. 

A look at its daily chart shows the ETF still trading above the short-term 25-day EMA as the outlook remains positive. Notably, that level coincides with the middle Bollinger band. This further supports the thesis that the prices will likely continue to trade above that zone, at least in the immediate term. 

As such, the range between that support level at $380 and the resistance along the upper Bollinger band at $392 will be worth watching. With further rebounding, GLD gold ETF will likely face resistance at $397 as the bulls fail to attract enough buyers to retest the all-time high hit in late October. On the flip side, I expect $372 to remain a steady support zone despite the improved risk appetite.

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