- China trade tensions, the Middle East, and US fiscal uncertainty have pushed gold towards $4,050.
- The Federal Reserve’s two more rate cuts and limited US economic releases further enhanced the safe-haven demand.
- The markets will likely be low-volume today, but traders will closely monitor FOMC Paulson’s speech for further direction.
The gold forecast remains bullish, testing all-time highs by rising above $4,050 per ounce, as heightened geopolitical and economic instabilities reclaimed the metal’s safe-haven appeal.
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Renewed US-China trade frictions acted as catalysts after President Trump threatened to impose 100% tariffs on Chinese exports and enforce new export regulations on critical software from November 1. Although his stance later eased, he left investors wary. In response, Beijing defended its rare earth export restrictions and threatened counteractions, which further intensified unease.
From the US, the persistent US government shutdown and lack of economic data have made it difficult for investors to identify the country’s economic trajectory. Restricted economic releases and slowing growth have strengthened expectations of Federal Reserve rate cuts of 25 basis points each during the remaining meetings of the year. Furthermore, lower interest rates have enhanced gold’s appeal as returns on interest-bearing assets have declined.
Additionally, the geopolitical developments in the Middle East, the ceasefire in Gaza,a and Trump’s visit to Israel have kept traders cautious, keeping safe-haven demand firm.
Overall, the combination of fresh trade tensions, persistent US fiscal uncertainty, and expectations of Fed easing keeps gold on the uptrend. In the absence of a stronger risk sentiment or a hawkish stance, the pair is likely to hold firm near-record highs, highlighting its safe-haven appeal amid geopolitical uncertainties.
Gold Key Events Ahead
The US observes a bank holiday today, resulting in thin trading activity. However, traders are looking forward to FOMC member Paulson’s speech for policy cues. Any dovish remarks could extend the uptrend, while hawkish signals may weigh down the pair.
Gold Technical Forecast: Maintains Bullish Bias near $4,068
The XAU/USD 4-hour chart suggests a strong bullish momentum as it trades around $4,068 after breaking above the $4,000 resistance level. The 20-, 50-, and 200-period MAs align well with the bull order. The short-term MAs above the long-term ones affirm a steady uptrend.
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The RSI is at 65, signaling a stable bullish trend, with overbought conditions yet to emerge. Resistance levels lie near $4,100, followed by $4,150. Meanwhile, the key support levels lie at $4,000 $3,950, and $3,850. A decisive break above $4,100 could extend gains to $4,200, while a slip below $4,000 could prompt a pullback.
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