Gold Price Forecast: XAU/USD buyers refuse to give up yet, eyeing seventh straight weekly gain

Gold is flatlining in a tight range above $3,850 early Friday, following its two-way business on Wednesday, on track to register the seventh consecutive weekly rise.

Gold pauses before the next push higher

The Artificial Intelligence (AI) frenzy-driven record highs on global stocks and a bout of profit-taking seemed to restrict the yellow metal’s upside attempts in the US last session.

Despite the pullback from record highs of $3,897, Gold manages to attract bargain-hunting demand as increased dovish expectations surrounding the US Federal Reserve (Fed) continue to bode well for the non-yielding bright metal.

Additionally, the haven demand for Gold remains intact amid a data blackout, courtesy of the extension of the US government shutdown, and the ongoing geopolitical tensions surrounding Russia and the North Atlantic Treaty Organization (NATO) nations.

Germany’s federal Police spokesperson told BILD newspaper that Munich airport has been closed following drones spotted over the airport.

Recent drone sightings across the European Union prompted a leaders' summit in Copenhagen this week.

20 Russian drones crossed into Poland and Russian MiG-31 jets entered Estonian airspace in separate recent incidents.

In light of this, the Group of Seven (G7) nations have vowed to tighten sanctions enforcement against Russia, pledging to phase out remaining imports and warning of penalties for countries and firms helping to finance Moscow’s war effort.

Looking ahead, Gold could see fresh retracement moves if traders continue to ignore the US shutdown concerns, further fuelling the risk rally. Markets believe that the shutdown is unlikely to last longer than a week and will likely have a negligible economic impact.

Meanwhile, the ISM Services PMI data and Fedspeak could offer fresh hints on the Fed’s path forward on easing, providing Gold traders some incentives heading into the weekend.

Gold price technical analysis: Four-hourly chart

As observed on the four-hour chart, the 14-day Relative Strength Index (RSI) holds above the midline, despite the latest move lower.

Therefore, the leading indicator continues to indicate that any dip in Gold could be quickly bought in.

Buyers must find acceptance above the $3,900 level on a daily/ weekly closing basis to resume the bullish momentum.

The next topside hurdle is located at the $3,950 barrier on the way to the $4,000 mark.  

Conversely, if the correction extends, Gold could test the initial support at $3,803, the 50-Simple Moving Average (SMA), below a drop toward the 100-SMA at $3,736 cannot be ruled out.  

Deeper declines could target the $3,700 round figure.