Gold price forecast: XAU/USD eyes breakout above $3.800 [Video]

• Gold price forecast: XAU/USD holds just under $3,800 as Fed rate cuts keep the market supported.

• China’s gold demand and record ETF inflows add fuel to the long-term bullish outlook.

• Technical setup: H4 Fair Value Gap ($3,791–$3,758) is key, with breakout aiming for $3,840–$3,880 or breakdown toward $3,720–$3,700.

 

In this Gold market analysis, we unpack why XAU/USD keeps pressing lofty levels after the Fed’s September cut, what’s fueling the move under the hood, and how the next high-impact Core PCE print could steer the next leg. Over the past week, gold notched fresh/all-time highs and is consolidating just beneath the $3,800 handle as markets price more Fed easing while risk hedges stay in demand. Add in rising ETF inflows and China’s strategic gold ambitions, and you have a potent backdrop that keeps dip-buyers active even as momentum cools.

What’s driving Gold

Post-Fed cut, easing still in play

After last week’s 25 bp cut, traders continue to price additional easing into year-end, even as Powell’s tone stays balanced on inflation vs. a softer labor market. That combination supports gold—lower expected real rates, steady hedging demand—while tempering one-way euphoria. Fed-probability trackers reinforce a bias to further cuts into Q4.

China’s strategic Gold posture – Structural demand

Beijing’s push to position itself as a global custodian/magnet for official-sector bullion underscores a longer-run tailwind for gold and the dedollarization narrative. Headlines this week highlighted new efforts to court foreign gold reserves via the Shanghai market and related infrastructure.

Inflows and safe-Haven bid at records

As prices printed new peaks, gold ETFs logged heavy net inflows (GLD among the largest), signaling broad participation beyond futures. Elevated geopolitical risk and equity wobble pockets keep the “insurance” bid alive.

This week’s high-impact (Red) calendar and why it matters

• Thu, Sep 25 – US Final GDP, Unemployment Claims, Durable Goods (red): Growth & claims wobble can extend the lower-yields impulse, supportive for gold; upside surprises could nudge real yields higher and cap rallies short-term.

• Fri, Sep 26 – US Core PCE (red): The Fed’s preferred inflation gauge. A softer-than-expected print strengthens the easing path (bullish gold). A hotter number revives “stickier inflation” risk, firming yields and inviting a pullback.

Technical outlook (XAU/USD)

Gold almost tagged $3,800 before pulling back and is now consolidating inside an H4 Fair Value Gap ($3,791 → $3,758). Price is hovering near the midline around $3,774, showing that the gap is acting as a balancing zone. This structure is key — if buyers continue to defend the gap, it signals absorption of supply; failure would hint at deeper retracement toward lower liquidity pools.

Bullish scenario: Gap defense and break above $3.800

• Buyers defend the $3,774 → $3,758 zone, absorbing selling pressure inside the FVG.
• A rebound from this pocket with a clean H4 close above $3,791, followed by a break of $3,800, confirms bullish continuation.
• If achieved, the upside trajectory extends to $3,820 → $3,840, with potential stretch into $3,880 on momentum.

Bullish Triggers:

• H4 candle rejection wick at $3,774/$3,758
• Break & retest above $3,800

Bearish scenario: Failure at FVG and breakdown below $3.758

• Price rallies into the FVG but fails to reclaim $3,791–$3,800, showing exhaustion.

• A rejection here, followed by a breakdown through $3,758, signals distribution from premium levels.

• This opens retracement targets toward $3,740 → $3,720, with deeper liquidity resting near $3,700.

Bearish Triggers:

• Repeated failure at $3,791–$3,800 zone.

• H4 close below $3,758.