Analyzes

The Indian Rupee just endured its most brutal six-month stretch in years, battered by a perfect storm of global shocks.

Gold is challenging the $4,050 level early Tuesday, extending the pullback from above $4,100, as sellers remain in control ahead of the two-day US Federal Reserve (Fed) monetary policy meeting, starting later in the day.     

Spot Gold gapped higher at the beginning of the new week, as a pause in Middle East hostilities underpinned the mood and weighed on the US Dollar (USD). The XAU/USD pair traded as high as $4,116.20 during Asian trading hours, following a pause in strikes between Iran and the United States (US).

Directional bias: Neutral to bullish above 0.6900, but the pair remains vulnerable to rejection as it struggles to assert itself above 0.7000.

While geopolitical headlines continually send traders rushing to the Oil charts, history shows that the biggest market moves often begin when liquidity disappears, not when crude spikes. 

Gold is off the highs but holds its bullish opening gap, while struggling near $4,100 early Monday. Despite the recent rebound, buyers trade with caution, keeping a close eye on the Middle East developments ahead of the US Federal Reserve (Fed) policy verdict this week.