Gold Futures Plunge: Buy-the-Dip Strategy Near $3,950 Activated

UPDATE: Gold futures are experiencing a significant downturn, testing critical support levels just above $3,950. As of October 28, 2025, the market has dropped nearly 10% from its all-time high, prompting traders to consider a buy-the-dip strategy. This urgent development comes amid increased pressure on safe-haven assets due to shifting sentiment surrounding US-China trade optimism.

Traders are now eyeing the $3,950.7 mark, a key liquidity zone that could trigger a reversal. If gold drops below $3,947 and then swiftly recovers, it could signal a potential rebound. The current trading strategy recommends watching for a liquidity sweep below $3,950.7, with an entry point around $3,947.5 if a rebound occurs.

Recent sessions have confirmed that the sell-off is largely driven by liquidity rather than fundamental weaknesses. The $3,948.5–$3,964.5 range aligns with significant technical indicators, suggesting traders should be prepared for a potential base formation or reversal. Should the price dip below $3,938, this could invalidate bullish positions, leading to further declines.

The analysis provided by tradeCompass emphasizes a high-risk, high-reward setup with a blended risk-reward ratio of approximately 5.8:1. Traders are advised to consider multiple exit points to lock in profits, including targets at $3,958, $3,983.5, and further up to $4,127.

Gold’s price action is influenced heavily by psychological levels, and the $3,950 threshold acts as a magnet for stop orders. Market makers often push prices beyond these points to trigger stops, a practice known as a liquidity hunt. A recovery above this level could indicate the exhaustion of selling pressure, creating a compelling opportunity for traders.

This analysis serves as a critical decision-support commentary from tradeCompass on investingLive.com. While the insights provided are invaluable, it’s important for traders to assess their own risk tolerance and market conditions before making positions. Trading futures involves substantial risks and may not suit all participants.

For those interested in real-time trade ideas, consider joining the community at investingLive for daily updates and insights. Remember, all trading carries risk, and capital should only be risked if it can be afforded to be lost.

Stay tuned for further updates as market dynamics continue to evolve.