Insights 
VT 
Gold prices remained stable near $4,000 following the Federal Reserve’s decision to cut interest rates by 25 basis points, settling at a range of 3.75%-4%. The decision was not unanimous, with differing opinions on the scale of the rate cut among Fed officials.
Economic growth was described as moderate, with slowing job gains and slightly elevated inflation contributing to a cautious stance on easing. The Fed announced it would cease balance sheet reductions from December 1, suggesting a more neutral approach to liquidity.
Gold Price Fluctuations
Gold fluctuated between $3,990 and $4,010, with traders anticipating further guidance from Fed Chair Jerome Powell. The metal’s resistance levels were identified at $4,030, $4,050, and $4,100, while support levels were noted at $3,900 and this week’s low of $3,886.
The Federal Reserve’s interest rate decisions affect inflation control and employment, using rate adjustments as a primary tool. The impact of rate changes varies, with potential strengthening or weakening of the US Dollar depending on the direction of the change. The most recent decision and its effects are closely watched for insights into future economic indicators.
The divided Fed vote signals significant uncertainty for the market’s direction. We should anticipate choppy price action, as one official pushed for a more aggressive cut while another preferred to hold steady. This internal disagreement at the Fed suggests the path forward for interest rates is far from clear, which typically fuels volatility.
With gold already near $4,000, much of the dovish news may already be priced in, so we are looking at options strategies with defined risk. We can consider buying call spreads on gold futures or related ETFs, targeting the $4,100 resistance level as a potential ceiling in the near term. This approach allows us to participate in further gains while capping our costs in an environment of elevated option premiums.
The Feds Cautious Stance
The Fed’s cautious stance reflects recent economic data, as we saw with the latest Non-Farm Payrolls report for September 2025 coming in below expectations at 155,000 jobs. However, the plan to stop reducing the balance sheet on December 1 is a powerfully dovish signal that should support risk assets. We saw a similar setup back in the summer of 2019, when the Fed began a rate cut cycle in response to slowing growth, which ultimately supported equities.
All eyes are now on the Chairman’s press conference for clues on whether this is a one-off adjustment or the start of a sustained easing cycle. The VIX index has been holding above 19, reflecting this uncertainty, and we expect it to remain elevated until we get more clarity. Any hints about the pace of future cuts will likely cause significant moves in Treasury yields and the dollar.
