Don’t get carried away before CPI! Is the gold price floor at 4150 solid, or is it a trap?

Today, Tuesday (October 13), during Asia hours, gold bulls overwhelmed the bears! Spot gold is currently quoted at $4,184.55 per ounce, surging $13.41 in a single day, up +0.32%. After an early dip to $4,150.68, bulls launched a frenzied counterattack, pushing the price up to a high of $4,185.02 and strongly breaking past the early high of $4,175! The $4,150 level proved robust once again, confirming a strong bottom, and gold prices have shifted from weak to strong. In the short term, the target is $4,190–$4,200, with bullish momentum unstoppable, waiting for CPI data to ignite a major move!

[News Flash]

Gold has retraced from above $4,500 in September all the way down to the $4,150–$4,200 region. On the surface, it seems like "risk aversion is fading," but in reality, the US dollar and US Treasury bonds have pushed the cost of holding non-yielding gold to uncomfortable levels. The US Dollar Index is stuck above 102, 10-year US bonds are sitting at a high 5% yield, money parked in dollar assets earns interest, while gold not only lacks interest but also carries exchange rate risk, so short-term capital naturally avoids chasing it aggressively.

But here’s the interesting part: as the price drops, ETFs and central banks are actually increasing their holdings. Global gold ETFs saw record net inflows in the third quarter, with approximately $10 billion added in September alone, pushing holdings to a new high of 4,256 tons; the People's Bank of China added another 740,000 ounces at the end of September, marking its 23rd consecutive month of gold purchases. This indicates the market is actually split in two—traders are exiting, while asset allocators are buying. The former are watching this week’s CPI and Federal Reserve rhetoric, while the latter focus on slow-moving variables like US dollar credibility, fiscal deficits, and diversification of reserves.

So it’s not simply that "gold is over," but that pricing power has temporarily shifted to the interest rate side.

Wednesday’s US September CPI is a crucial turning point. What the market really watches isn’t overall inflation, but the core data: if the core is hot, the odds of a December rate hike rise again, US Treasury yields spike, the dollar strengthens, and gold prices may pull back to $4,155 or even $4,100; if the core is mild, rate hike expectations loosen, actual US bond yields are seen peaking, and gold could rally again towards $4,200–$4,230.

[Latest Spot Gold Market Analysis]

Technically, unless gold stands firm above $4,200 with volume, it’s only a rebound, not a reversal; the $4,150–$4,100 zone below is short-term bullish defense, while $4,000–$4,030 is the “slow bottom” welded in place by central bank buying and ETF inflows.

Whether this round of retracement is just a correction or a buying opportunity depends on which side you’re on:

If you’re trading the swings, chasing gains here is less cost-effective; wait for CPI to set the direction for more certainty.

If you’re building portfolio allocation, the closer the price is to $4,000, the nearer it is to the “allocator’s sweet spot.” But don’t turn bottom fishing into an all-in bet—before high rates confirm a reversal, gold is better suited for incremental buying rather than aggressive entries.

The long-term logic remains intact: de-dollarization, central bank gold purchases, and the revaluation of US Treasury credit continue to slowly lift gold’s floor; the short-term shackles haven’t loosened either: real interest rates and the dollar still weigh on it. Gold prices are currently caught between these two forces, awaiting one side to give way.