Gold declines below $3,950 as US dollar strengthens, midterm elections in focus
ITF Team2 min read
Gold slipped to around $3,930 on Nov 3, 2026, pressured by a firmer US dollar and higher Treasury yields as traders watch US midterm elections for fiscal clues.
Key takeaways
- Gold fell to near $3,930 in early Asian trading on 11/3/2026.
- The US dollar index hovered around 101.30 as yields rose to 4.90% on the 10‑year Treasury.
- Central banks bought a net 321 tons of gold in Q3 2026, the fastest pace since 2024.
- Commerzbank noted a 3.7% drop on Friday, leaving October with a 7% monthly loss.
Gold slipped below the $3,950 level on Wednesday, 3 Nov 2026, trading around $3,930 in the early Asian session. The move was driven by a modest rise in the US dollar and higher US Treasury yields, while market participants kept a close eye on the unfolding US midterm elections for clues on future fiscal policy.
Dollar strength and yield pressure weigh on gold
The US Dollar Index edged up to roughly 101.30 as traders priced in uncertainty over a possible US‑Iran settlement and the outcome of the midterms. At the same time, the 2‑year Treasury yield rose five basis points to 4.566% and the benchmark 10‑year slipped to 4.90%, lifting real interest rates and increasing the opportunity cost of holding a non‑yielding asset such as gold.
Higher yields typically make bonds more attractive relative to gold, prompting a shift away from the yellow metal. This dynamic helped push XAU/USD below the 100‑day simple moving average and the middle Bollinger Band, reinforcing a bearish bias in the daily chart.
Election outlook and its influence on the dollar
Analysts expect the Democrats to capture the House, while the Senate remains uncertain. A Democratic sweep could constrain the administration’s ability to raise the debt ceiling, potentially weakening the dollar. Forex.com analyst Fawad Razaqzada noted that a weaker dollar would likely support gold, but the market has not yet priced in that scenario.
Until election results are clear, the dollar’s short‑term rally remains a key headwind for gold, limiting any immediate rebound despite the metal’s safe‑haven appeal.
Read also: Gold reclaims $4,000 after US election
Central‑bank buying and revised investment forecasts
The World Gold Council reported that central banks accumulated a net 321 tons of gold in Q3 2026, the fastest pace since the end of 2024. This buying helped offset some of the price pressure, but the Council also cut its 2026 investment‑growth forecast to 200 tons from an earlier 400‑ton estimate, reflecting lingering uncertainty.
The strong demand from sovereign reserves underscores gold’s role as a store of value, yet the metal’s price remains sensitive to short‑term dollar and yield moves.
Technical picture: below the 100‑day SMA
On the daily chart, gold is trading under the 100‑day SMA and the Bollinger middle band, with the Relative Strength Index at 36.09, just above oversold territory. Immediate resistance sits near $4,080, while support is anchored at the lower Bollinger band around $3,900. A break below $3,900 could open further downside, whereas a hold above may lead to consolidation within the band structure.
- Current price: ~ $3,930
- USD Index: ~101.30
- 10‑yr Treasury yield: 4.90%
- 100‑day SMA: $4,205
- Key support: $3,900
- Key resistance: $4,080
Frequently asked questions
Why did gold fall below $3,950 on 3 Nov 2026?
Gold slipped to about $3,930 as a slightly stronger US dollar and higher Treasury yields raised the cost of holding a non‑interest‑bearing asset. The dollar’s rise was linked to uncertainty over US‑Iran talks and the upcoming midterm elections, which kept risk sentiment low for gold.
How do US midterm elections affect gold prices?
If Democrats win control of the House, it could make it harder for the administration to raise the debt ceiling, potentially weakening the dollar. A weaker dollar would normally support gold, but until the election outcome is confirmed, the dollar’s short‑term strength continues to press on gold prices.
What technical levels should traders watch for gold?
Traders are looking at the lower Bollinger band around $3,900 as immediate support; a break below could trigger further declines. On the upside, resistance is near $4,080 (Bollinger middle band) and the 100‑day SMA at $4,205. The RSI at 36 suggests the metal is close to oversold but not yet exhausted.
Official data sources
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This article is compiled from international market news for information only. It is not investment advice.