Gold Enters Tight Compression Zone

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Gold is moving sideways around 4,520 – 4,540 USD after the sharp selloff earlier this week.

The market is no longer seeing heavy panic selling, but buyers also still lack enough momentum for a clean breakout. EMA34 and EMA89 are beginning to compress, while candle ranges and volume continue shrinking — a typical sign of volatility compression before a larger move.

Sellers are no longer dominating as aggressively as before, but safe-haven demand remains weak because US Treasury yields and the dollar are still elevated.

The market is currently trapped between expectations of a softer Fed if growth slows and fears that inflation may keep rates higher for longer.

If gold holds above 4,500 – 4,510 USD, a rebound toward 4,560 – 4,580 USD remains possible. But a breakdown below support could quickly trigger another bearish wave.

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