On September 16, gold prices continued their range-bound consolidation, with the Asian session opening with a rise before pulling back after a rebound to 4320. The European session saw a decline to the day's low around 4260, which conveniently triggered a long entry at the 4260 range, and the US session recovered above 4300, delivering a modest profit. The yellow metal ultimately settled at 4293 dollars, concluding the day with a small bearish doji candle.
Looking ahead to the early hours of Thursday, Beijing time, the Federal Reserve is set to unveil its September rate decision, the dot plot, and economic projections, followed by Chair Walsh's press conference at 2:30 AM. Market pricing for a 25-basis-point rate increase has surged to between 88% and 93%. This probability has climbed steadily from roughly 60% just a week prior, indicating the market has shifted from debating whether a hike will occur to pricing in the potential consequences of such a move.
If the rate hike is confirmed, the market's immediate response will heavily depend on Walsh's commentary. Should he signal that this increase allows for a period of observation, gold might experience an initial dip before stabilizing. Conversely, if he emphasizes the possibility of further hikes, gold could face sustained downward pressure. The direction is likely to be dictated by tonight's language, while the extent of any move will be influenced by underlying buying interest. Momentum for a sharp selloff appears limited, a significant rally requires a clear catalyst, leaving the most probable scenario as a phase of intense volatility before a directional choice is made.
From a technical standpoint, gold has continuously traded at low levels over the past two days, forming a potential triangular pattern with a narrowing range. This often indicates that the market may be preparing for a decisive breakout, potentially fueled by the forthcoming Fed decision. Until that announcement, the precious metal is expected to remain within its current trading band. The hourly chart suggests a consolidation range between 4330 and 4270, though the heightened pre-meeting sentiment could trigger an early release of bearish expectations. For the day session, a continued sideways movement is anticipated, and traders are advised to employ light positions within the range and reduce exposure before the critical announcement.
The near-90% likelihood of a rate increase means the market has largely priced in this outcome. The true variable now lies in Chair Walsh's post-meeting rhetoric. Any directional bet before the official announcement is speculative. A more prudent strategy would be to await the outcome, allow the market to digest the news, and then engage with a clearer picture for a higher probability of success. The suggested operational approach for the day includes initiating a long position in gold at the 4290-4300 area, with a stop-loss at 4280, and targeting the 4400-4450 zone for potential continuation. Should prices break below 4270, the long idea should be abandoned. Key economic data and events on Wednesday, September 16, 2026, include the US retail sales and import price indices at 8:30 PM, the NAHB housing market index and business inventories at 10:00 PM, followed by the FOMC rate decision and economic projections at 2:00 AM and Chair Walsh's press conference at 2:30 AM the next day.