The current landscape for gold seems tumultuous, with prices taking a hit after the U.S. Federal Reserve maintained a hawkish tone in its latest meeting. The question arises: Is this a temporary stumble or a longer-term trend? This analysis delves into the nuances influencing gold's performance.

1. The Hawkish Fed:

   Aggressive Stance: The U.S. Federal Reserve has maintained an aggressive monetary policy of tightening, which has served as a significant headwind for gold.

2. Yield Conundrum:

   Competing for Space: As a non-yielding asset, gold faces competition for a place in portfolios. This becomes particularly challenging as yields rise, reducing gold's relative attractiveness.

   Historical Low: Gold ETF holdings are now at their lowest since early 2020, and net long positioning is the lowest since March, indicating significant new short positions.

3. The USD1,900 Threshold:

   Tipping Point: The gold price recently dipped below the USD1,900/oz mark for the first time since March, prompting questions about its investment viability.

4. The Dilemma of Central Banks:

   Global Trend: Most central banks are in a rate-raising mode, with China being an exception, further pressuring gold prices.

5. Opportunity Beckons:

   Buy the Dip?: According to our analysis, any dip below USD1,900/oz should be viewed as a buying opportunity. We argue that upside moves in the USD-denominated gold price should be faded until a clear downward trend in yields and the USD emerges.

Conclusion: While the Federal Reserve's hawkish stance and the global trend of rising interest rates have posed challenges for gold, a dip below USD1,900/oz could present a unique buying opportunity. Investors might consider capitalizing on these lower prices, particularly if they anticipate a future downward trend in yields and the USD.