Gold price (XAU/USD) trades in positive territory near $4,185 during the early Asian session on Friday. The precious metal drifts higher as traders anticipate that the reopening of the US government will restore the flow of economic data and reinforce bets of further US interest rate cuts.

A record shutdown in US history ended on Thursday after Trump signed a funding bill to reopen the government. The House of Representatives approved the bill earlier Thursday in a 222-209 vote, with nearly every Republican and a handful of Democrats voting for it. The expectation that US economic data released after the end of the shutdown will reveal US labor market weakness could weigh on the US Dollar (USD) and lift the USD-denominated commodity price in the near term. 

On Thursday, White House economic adviser Kevin Hassett said that the government would publish the October employment data, but without the Unemployment Rate due to the lack of a household survey that month.

On the other hand, the cautious tone from the Fed officials could undermine the yellow metal. Boston Fed President Susan Collins used cautious language to express her opinion on policy, saying that it will likely be appropriate to keep policy rates at the current level for some time to balance the inflation and employment risks in this highly uncertain environment. 

Meanwhile, Atlanta Fed President Raphael Bostic on Wednesday and Cleveland Fed President Beth Hammack on Thursday have also expressed a preference for holding rates steady.

Markets are now pricing in a more than 51% chance that the Fed will cut its benchmark overnight borrowing rate by a quarter percentage point at its December meeting, down from 62.9% odds that markets priced in a day ago, according to the CME FedWatch Tool.

XAU/USD Current price: $4,207.20

• The United States government ended the longest shutdown on record.
• Wall Street suffers after flirting with record highs, underpinning Gold.
• XAU/USD loses upward momentum, risk remains skewed to the upside.

Gold price peaked on Thursday at $4,245 a troy ounce, a fresh three-week high, but it trimmed part of its intraday gains and currently hovers around $4,200. The XAU/USD pair surged throughout the first half of the day, amid the US Dollar (USD) edging sharply lower on the back of headlines indicating that the United States (US) government had resumed its activities after passing a funding bill that will cover the period until January 30.

Optimism eased during European trading hours, pushing XAU/USD below the $4,200 mark. However, the soft tone of Wall Street, hinting at fresh market concerns, helped the bright metal recover some ground.

US indexes turned south with the Dow Jones Industrial Average retreating from fresh record highs, down roughly 400 points at the time of writing. The heavy tech-weighted Nasdaq Composite is the worst performer, down 1.76% amid weakness among tech shares, amid worries about those being overvalued.

Other than that, market participants are concerned about the upcoming flood of US economic data after a forty-three-day silence, and the potential impact of such figures on the December Federal Reserve (Fed) monetary policy decision. Odds for a December interest rate cut fell after Chair Jerome Powell noted that the movement should not be taken for granted, following the October meeting. According to the CME FedWatch Tool, the odds for a December cut stand at 53.6%, while those for a no-change outcome account for 46.4%.

XAU/USD short-term technical outlook

Technical Analysis:

The XAU/USD pair trades at $4,207.20, and the 4-hour chart shows fading upward strength, although a well-limited downward scope. The 20-period Simple Moving Average (SMA) stands at $4,164, providing dynamic support as it rises above the 100- and 200-period SMAs, with all three indicators sloping higher, in line with the dominant bullish trend. At the same time, the Momentum indicator fades above its 100 line, while the Relative Strength Index (RSI) indicator eases from overbought readings, but still stands at 66, in line with buyers’ dominance. Trend-following bias would remain intact while the metal respects the rising 20-period SMA, with pullbacks expected to be shallow if buyers defend that zone.

In the daily chart, XAU/USD is developing above all its moving averages, with a flat 20-day SMA holding above the bullish 100- and 200-day SMAs. The mentioned 20-day SMA provides support at $4,076. At the same time, the Momentum indicator holds above its midline, but aims marginally higher, while the RSI indicator flattens around 64. Buyers should retain control as long as the 20-day SMA holds, with scope to extend its advance towards the $4,300 threshold once the price surpasses the intraday high at $4,245.

(The technical analysis of this story was written with the help of an AI tool)

Gold is trading close to three-week highs early Thursday, challenging offers near the $4,200 level.    

Gold awaits clarity on US data publication

Despite the retreat, Gold remains the most sought after investment asset so far this week.

Concerns prevail over the health of the United States (US) economy in the face of uncertainty over data publication, even as the government is set to reopen after the House of Representatives voted 222-209 to end the record shutdown.

This comes after White House Press Secretary Karoline Leavitt said Wednesday, the federal jobs and inflation reports for October may never get calculated and released due to the shutdown.

Meanwhile, several economists believe that the missed September data will be published as early as next week, while urging the US Labor Department to prioritize November employment, CPI data post-shutdown, per Reuters.

The lack of clarity on the resumption of the statistics prompts markets to trade cautiously, lending some support to safe-haven US Dollar (USD), in turn, capping the Gold price upside.

However, any pullback in Gold will likely be short-lived as markets continue to predict an 25 basis points (bps) interest rate cut by the US Federal Reserve (Fed) next month, according to 80% of economists polled by Reuters.

Looking ahead, Gold traders will continue to closely scrutinize speeches from Fed officials as the central bank appears divided on the next rate move amid weakening labor market conditions and the inflation dilemma.

Gold price technical analysis

As observed on the daily chart, the 14-day Relative Strength Index (RSI) is hold firm near 64, as of writing.

The leading indicator, thus, suggests that upside risks remain intact for Gold.

Buyers need a daily candlestick closing above the $4,200 mark to accelerate further toward the $4,250 psychological level.

Acceptance above the latter will open the door for a retest of the record high at $4,382.

Alternatively, any pullback will likely find support at the previous resistance of $4,129, the 23.6% Fibonacci Retracement level of the parabolic rise to the record high that began on August 19.

The next downside target is seen at the 21-day Simple Moving Average (SMA) of $4,087, below which the $4,050 psychological level will be challenged.

XAU/USD Current price: $4,204.20

• Market players anticipate the US government shutdown will end in a matter of days.
• Official United States data is likely to flood news feeds next week.
• XAU/USD reconquered the $4,200 mark and aims to continue advancing.

Spot Gold flirts with the $4,200 level in the American session on Wednesday, as demand for the US Dollar (USD) continues to lose steam. The Greenback managed to post some modest intraday gains against the bright metal at the beginning of the day, but quickly changed course despite a generalized better market mood.

On the one hand, financial markets anticipate that the United States (US) will end the funding stalemate as soon as this week, as the House of Representatives is due to vote on the Senate funding bill before the day is over. After that, it would only be pending US President Donald Trump’s signature to become a law.

On the other hand, Asian and European indexes traded with a better tone amid a bounce in the tech sector, although US ones remain mixed, with only the Dow Jones Industrial Average posting record highs at the time of writing.

It is worth noting that the US government reopening will bring back official data, critical ahead of the Federal Reserve (Fed) December monetary policy decision. In previous shutdowns, data releases began five working days after the federal reopening, which means the upcoming week could be quite busy. 

XAU/USD short-term technical outlook

XAU/USD trades at $4,204.20, and the 4-hour chart shows it’s up for the day. The 20-period Simple Moving Average (SMA) climbs above the 100- and 200-period SMAs, while price holds above all three, keeping the near-term tone positive. The 100-period SMA flattens after a prior slide, and the 200-period SMA rises, reinforcing bullish pressure. At the same time, the Momentum indicator resumed its advance above its 100 line, while the Relative Strength Index (RSI) indicator stands at 72 , partially losing its bullish strength.

Bulls remain in control as the short-term trend rises and dips stay supported by the moving averages. A pullback would find deeper support at the 200-period SMA near $4,042.81 and the 100-period SMA at $4,035.33. A break under the $4,042.81–$4,035.33 area would deny the bullish potential.

In the daily chart, the 20-day SMA stands above the 100- and 200-day measures, with the longer SMAs rising while the 20-day flattens. XAU/USD holds above all of them, which keeps the risk skewed to the upside. Technical indicators, in the meantime, hint at mounting upward pressure, as the Momentum and the RSI advance within positive levels.

(The technical analysis of this story was written with the help of an AI tool)