Interest rate cut expectations fall short, can gold still rise?

Gold has recently been stuck in a tug-of-war. Sky Links Capital CEO Daniel Takieddine made a very direct statement:
“As market expectations for a Fed rate cut weaken, the upside potential for gold may be limited.”
📌 Core limiting factors:
1️⃣ Strong US labor data → US Treasury yields stay high → Non-yielding assets like gold come under pressure
2️⃣ Easing expectations of Middle East conflict → Ongoing diplomatic efforts lead markets to bet on de-escalation → Safe-haven demand weakens
3️⃣ Fed rate cut expectations cooling → Market shifts from aggressive rate cut pricing earlier in the year to “higher for longer”
🛡️ But bulls haven’t completely surrendered; two main supports remain:
✅ Geopolitical risks outside the Middle East (such as Russia-Ukraine, other regional frictions)
✅ Central banks continuously buying gold (long-term structural demand)

In the short term, gold’s movement is a tug-of-war:
· If upcoming US economic data (CPI, non-farm payroll) continue to beat expectations → Rate cut expectations further delayed → Gold prices may test key support levels
· If the Middle East situation suddenly escalates or central banks’ gold purchases exceed expectations → Gold still has room for pulses of upward movement

· To be bullish on gold, wait for: rate cut expectations to heat up again, or geopolitical risks to substantially escalate
· To be bearish on gold, watch out: central bank gold buying is a solid support, and downside space may not be large
· Currently, it’s more suitable for range trading rather than one-sided bets
Implications for the crypto market:
Gold and Bitcoin once showed correlation under the logic of “weakening fiat currency confidence,” but currently, gold is constrained by US bond yields, while Bitcoin benefits from the independent narrative after the halving. If rate cut expectations continue to weaken, it’s a macro headwind for both assets, but Bitcoin’s volatility may be greater.
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