Gold (XAUUSD) Price Forecast: Bulls Hold $4000 as Shutdown, Rate Cut Bets Boost Demand

Gold Firms Above $4000 as Safe-Haven Bids Continue, Dollar Softens

Gold prices edged higher on Friday, with spot gold (XAU/USD) settling at $4001.28, up $24.14 or +0.61%. Buyers stepped in for the third straight session, supported by a weaker U.S. dollar and persistent concerns over the ongoing government shutdown, now in its 38th day. The market continues to base out between $3886.46 and $4046.60, with bulls defending the strong side of the 50-day moving average at $3878.45.

Safe-Haven Flows Return as Shutdown Risk Lingers

Uncertainty around the delayed U.S. non-farm payrolls report — a result of the shutdown standoff — helped renew safe-haven demand, especially after private sector data showed job losses in October. Traders are now pricing in a 66% chance of a December rate cut, according to CME Group’s FedWatch Tool. That dovish repricing, alongside softening Treasury yields, is helping underpin gold despite broad risk aversion.

Wall Street’s tech-heavy indexes posted their worst weekly loss in seven months, as traders questioned the staying power of the recent AI-driven rally. Meanwhile, the U.S. Dollar Index (DXY) settled at 99.556, down 0.141 or -0.14%, making dollar-denominated bullion more attractive to foreign buyers.

India Demand Slips, China Policy in Focus

Physical demand in India remains sluggish, with price volatility keeping buyers on the sidelines. Local dealers are offering steep discounts to move product. In China, the market is watching Beijing’s proposed overhaul to its rare earth licensing system — a move that could speed up exports but won’t fully lift restrictions, according to industry sources.

Technical Outlook: Support Base Holding, Bulls Eye $4046.60

Gold continues to consolidate inside a wide support zone between $3886.46 and $4046.60. The short-term bias stays bullish above the 50-day MA at $3878.45 and the 50% retracement level at $3846.50. A confirmed break below the latter could spark a sharp decline, potentially targeting $3700.

On the upside, a breakout above $4046.60 would open the door to the next resistance band, defined by a 50% level at $4133.95 and a 61.8% retracement at $4192.36. That zone is likely to attract sellers unless rate cut odds climb further or safe-haven flows intensify.

Gold Price Forecast: Still Constructive, But Needs a Catalyst

As long as $3846.50 holds on dips, gold’s near-term structure remains intact. But upside momentum remains capped for now. Without a fresh catalyst — from Fed policy signals, economic data, or deepening risk-off sentiment — rallies into the $4133.95 to $4192.36 retracement zone may struggle to gain traction. For now, the metal is holding firm, but conviction above $4046.60 is still lacking.

More Information in our Economic Calendar.