Gold Price Forecast: XAU/USD bulls seem unstoppable amid the global flight to safety
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UPGRADE- Gold buying remains unabated for the third straight day as tariff woes fuel safe-haven demand.
- The USD hangs near a two-week low amid the ‘Sell America’ trade and supports the XAU/USD.
- Traders now look forward to the US PCE Price Index for Fed rate cut cues and a fresh impetus.
Gold (XAU/USD) continues scaling new record peaks for the third consecutive day and climbs further beyond the $4,850 level during the Asian session on Wednesday. US President Donald Trump doubled down on his threats to take over Greenland and said on Tuesday that there is no going back on his ambition to take control of the Arctic island. Trump claimed that Greenland is imperative for national and world security, arguing that Denmark is unable to protect the territory. Trump also refused to rule out the use of military force to achieve his aims, rattling investors worldwide and leading to the overnight 2% slump on Wall Street. Asian equities are also experiencing significant spillover effects amid a sharp rise in volatility, which continues to drive safe-haven flows towards the precious metal.
Meanwhile, Trump threatened a 200% tariff on French wine and champagne after President Emmanuel Macron reportedly declined an invitation to join Washington’s “Board of Peace” for the Gaza transition. The French president has been among those urging the European Union (EU) to consider retaliatory countermeasures against US tariffs. Macron also condemned the endless accumulation of new tariffs as fundamentally unacceptable, particularly when used as leverage against territorial sovereignty. Nevertheless, Trump's push to take control of Greenland continues to fuel worries that a trade war with Europe could re-escalate. This, along with geopolitical uncertainties and the prevailing bearish sentiment around the US Dollar (USD), backs the case for a further appreciation of the Gold price.
The developments prompted a repeat of the so-called “Sell America” trade and dragged the USD Index (DXY), which tracks the Greenback against a basket of currencies, to a nearly two-week low on Tuesday. This turns out to be another factor acting as a tailwind for the bullion and validates the near-term positive outlook. However, reduced bets for more aggressive policy easing by the US Federal Reserve (Fed) hold back the USD bears from placing aggressive bets. Market participants also seem reluctant ahead of the release of the US Personal Consumption Expenditure (PCE) Price Index on Thursday, which will be accompanied by the final US Q3 GDP report. The crucial data might offer cues about the Fed's rate-cut path and drive the USD demand, and provide a fresh impetus to the non-yielding yellow metal.
XAU/USD 4-hour chart
Technical Analysis:
The ascending channel from $4,253.30 underpins the uptrend, and the Gold price has pushed through the upper boundary near $4,604.17, signaling a breakout and continuation bias. The Moving Average Convergence Divergence (MACD) line extends above the Signal line, with both in positive territory, and the widening positive histogram suggests strengthening bullish momentum. RSI stands at 84.10 (overbought), indicating stretched conditions that could cap immediate gains.
The breakout favors trend extension, with pullbacks expected to be shallow while momentum remains firm. A moderation in RSI from overbought territory would improve the scope for sustained upside, whereas fading MACD momentum would open room for consolidation back toward the breakout area.
(The technical analysis of this story was written with the help of an AI tool.)
- Gold buying remains unabated for the third straight day as tariff woes fuel safe-haven demand.
- The USD hangs near a two-week low amid the ‘Sell America’ trade and supports the XAU/USD.
- Traders now look forward to the US PCE Price Index for Fed rate cut cues and a fresh impetus.
Gold (XAU/USD) continues scaling new record peaks for the third consecutive day and climbs further beyond the $4,850 level during the Asian session on Wednesday. US President Donald Trump doubled down on his threats to take over Greenland and said on Tuesday that there is no going back on his ambition to take control of the Arctic island. Trump claimed that Greenland is imperative for national and world security, arguing that Denmark is unable to protect the territory. Trump also refused to rule out the use of military force to achieve his aims, rattling investors worldwide and leading to the overnight 2% slump on Wall Street. Asian equities are also experiencing significant spillover effects amid a sharp rise in volatility, which continues to drive safe-haven flows towards the precious metal.
Meanwhile, Trump threatened a 200% tariff on French wine and champagne after President Emmanuel Macron reportedly declined an invitation to join Washington’s “Board of Peace” for the Gaza transition. The French president has been among those urging the European Union (EU) to consider retaliatory countermeasures against US tariffs. Macron also condemned the endless accumulation of new tariffs as fundamentally unacceptable, particularly when used as leverage against territorial sovereignty. Nevertheless, Trump's push to take control of Greenland continues to fuel worries that a trade war with Europe could re-escalate. This, along with geopolitical uncertainties and the prevailing bearish sentiment around the US Dollar (USD), backs the case for a further appreciation of the Gold price.
The developments prompted a repeat of the so-called “Sell America” trade and dragged the USD Index (DXY), which tracks the Greenback against a basket of currencies, to a nearly two-week low on Tuesday. This turns out to be another factor acting as a tailwind for the bullion and validates the near-term positive outlook. However, reduced bets for more aggressive policy easing by the US Federal Reserve (Fed) hold back the USD bears from placing aggressive bets. Market participants also seem reluctant ahead of the release of the US Personal Consumption Expenditure (PCE) Price Index on Thursday, which will be accompanied by the final US Q3 GDP report. The crucial data might offer cues about the Fed's rate-cut path and drive the USD demand, and provide a fresh impetus to the non-yielding yellow metal.
XAU/USD 4-hour chart
Technical Analysis:
The ascending channel from $4,253.30 underpins the uptrend, and the Gold price has pushed through the upper boundary near $4,604.17, signaling a breakout and continuation bias. The Moving Average Convergence Divergence (MACD) line extends above the Signal line, with both in positive territory, and the widening positive histogram suggests strengthening bullish momentum. RSI stands at 84.10 (overbought), indicating stretched conditions that could cap immediate gains.
The breakout favors trend extension, with pullbacks expected to be shallow while momentum remains firm. A moderation in RSI from overbought territory would improve the scope for sustained upside, whereas fading MACD momentum would open room for consolidation back toward the breakout area.
(The technical analysis of this story was written with the help of an AI tool.)
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