The Federal Reserve announced a 25 basis point interest rate cut

On December 11 at midnight Beijing time, the Federal Reserve announced a 25 basis point interest rate cut, lowering the target range for the federal funds rate to 3.5%-3.75%. Federal Reserve Chairman Powell stated that the Federal Reserve has been adjusting towards a neutral interest rate and is currently at the upper end of the neutral rate range, with no decision made regarding January matters.

The labor market seems to be gradually cooling down, and inflation levels remain high. The Federal Reserve is committed to achieving a 2% inflation target. If no new tariffs are announced, commodity inflation should peak in the first quarter of next year. Currently, raising interest rates is not a baseline expectation for anyone, and the current policy divergence lies in whether to maintain the interest rate or cut it.

Gold quickly rebounded after hitting a low point at 4182, forming a clear V-shaped reversal pattern. Currently, the J-line is approaching the 100 overbought zone, while the K-line and D-line are moving upwards in sync but with a slowing slope, indicating that while short-term bullish momentum still exists, the risk of a pullback due to overbought conditions is increasing, requiring vigilance against minor corrections at high levels.

Recommended Gold: Short on a rebound to the 4245-4255 area, targeting around 4180.