Gold Holds $4,100 as Traders Eye Fed Decision and Middle East

Gold is trading near the $4,100 level early Monday after pulling back from session highs. The metal opened with a bullish gap, supported by a pause in Middle East tensions and a sharp drop in oil prices.

However, buyers are struggling to extend gains as market participants adopt a cautious stance before the Federal Reserve’s policy announcement this week. The Fed’s decision and guidance will influence interest rate expectations and the US dollar, providing the next catalyst for XAU/USD.

The early-week bid was driven by a temporary easing of geopolitical risks in the Middle East and a slump in crude oil prices, which often reduces inflation fears. Still, gold has struggled to clear resistance near $4,100, keeping the short-term trend uncertain. Traders are now focused on the Fed’s rate verdict and accompanying statement for clues on borrowing costs.