Gold Forecast Today : XAU/USD Targets $4,000
Gold extends record rally as investors seek refuge from global uncertainty
Gold (XAU/USD) continues its powerful uptrend, surging beyond $3,950 per ounce and marking new record highs as investors flock to safe-haven assets amid a prolonged U.S. government shutdown, dovish Federal Reserve (Fed) expectations, and escalating political tensions in France and Japan.
At the time of writing, XAU/USD trades near $3,956 during the U.S. session — up nearly 1.8% on the day — extending its winning streak to an eighth consecutive week. The rally underscores sustained bullish momentum as traders continue to price in two additional Fed rate cuts before year-end.
Market Drivers: Political Turmoil and Central Bank Policy Fuel Bullion Demand
The U.S. government shutdown, now entering its sixth day, has disrupted federal operations after failed negotiations in Washington. Analysts warn of broader economic consequences if the deadlock persists. Meanwhile, France’s political instability intensified following the resignation of Prime Minister Sébastien Lecornu, deepening uncertainty in the Eurozone.
In Asia, Sanae Takaichi’s victory as the new Liberal Democratic Party (LDP) leader positions her to become Japan’s first female prime minister. Markets interpret her leadership as favoring softer monetary policy and increased fiscal spending, a move likely to keep the Japanese Yen (JPY) under pressure.
The combination of these factors has reinforced the safe-haven appeal of Gold, driving continued ETF inflows and central bank purchases. However, a rebounding U.S. Dollar (DXY), currently hovering near 98.35, has partially capped Gold’s upside momentum.
Fed Policy Outlook: Markets Bet on More Rate Cuts
Investor focus remains squarely on the Federal Reserve’s monetary policy path. The CME FedWatch Tool indicates a 95% probability of a 25-basis-point (bps) rate cut at this month’s FOMC meeting, and an 83.7% likelihood of another in December. These expectations continue to underpin demand for non-yielding assets such as Gold.
The ongoing government shutdown has delayed the release of critical U.S. data, prompting markets to rely on Fed communications and private-sector indicators. Traders are awaiting the Fed Meeting Minutes for further insight into the central bank’s dovish stance.
Technical Analysis: Bulls Eye $4,000 Psychological Barrier
Technically, Gold remains in a strong bullish structure after breaking above the $3,900 resistance. The 21-period SMA near $3,879 acts as immediate support, followed by the 50-period SMA around $3,826.
A decisive breakout above $3,949 could pave the way for a psychological test at $4,000, while a dip below $3,900 may trigger short-term consolidation.
The Relative Strength Index (RSI) currently hovers around 69, suggesting Gold may pause before the next upward leg — a typical breather within strong uptrends.
