Insights 
VT 
Gold As A Safe Haven
Gold prices are influenced by geopolitical factors, interest rates, and the US Dollar’s value. Typically, lower interest rates benefit gold, whereas higher borrowing costs lead to price declines. Gold remains a key asset for those seeking stability and security during economic uncertainties.
Gold is finding support around the $2,450 per ounce mark, largely due to a softer US Dollar. We are seeing the market price in a pause from the Federal Reserve at its meeting next month, as recent economic data suggests a slowdown. This creates a favorable environment for non-yielding assets like gold.
The Fed’s next move is uncertain, creating opportunities for derivative traders. September’s Consumer Price Index came in at a sticky 3.5%, higher than anticipated, but last week’s slowing jobs report has complicated the central bank’s path. The CME FedWatch Tool now indicates a 70% probability of rates being held steady, but bets on a rate cut in the first quarter of 2026 are increasing.
Geopolitical Support
This situation feels familiar, reminding us of the late 2019 environment when expectations of Fed rate cuts also drove the market. Back then, trade tensions between the US and China under President Trump were the dominant theme capping gold’s gains. Today, the focus has shifted to persistent inflation and the sustainability of global growth.
Geopolitical risks remain a key pillar of support for gold prices, acting as a potential catalyst for a sharp move higher. Ongoing tensions in the Middle East and Eastern Europe continue to fuel safe-haven demand. Any escalation in these conflicts could easily push gold through near-term resistance levels.
We’ve seen central banks continue their historic buying spree, a trend that has accelerated since 2022. The World Gold Council’s Q3 2025 report confirmed that central banks collectively added another 250 tonnes to their reserves, signaling a deep-seated belief in gold as a store of value. This consistent demand provides a strong underlying floor for the price.
Given the conflicting signals, we are seeing rising implied volatility in gold options. Traders could consider strategies like straddles to play the potential for a large price swing, regardless of direction, following next month’s Fed announcement. Meanwhile, call options offer a defined-risk way to position for an upside break driven by geopolitical events.
