Gold Price Forecast: XAU/USD resumes advance as US shutdown about to end

XAU/USD Current price: $4,096.73

• News that the US government could soon reopen weighed on the US Dollar.
• New Zealand inflation and the United Kingdom's inflation are on the docket.
• XAU/USD resumed its advance despite a better mood, record high in sight.

Spot Gold surged on Monday, briefly surpassing the $4,100 mark, holding nearby in the mid American afternoon. Easing demand for the US Dollar (USD) on prospects that the United States (US) government shutdown may end soon underpinned the bright metal despite an upbeat mood.

The Greenback traded mixed throughout the first half of the day, although the poor performance of Wall Street compared to its overseas counterparts is helping it advance ahead of the upcoming Asian session.

Weekend headlines indicated that the United States (US) Senate passed on Sunday a temporary funding bill, with the chamber voting 60-40 in favor of it, thanks to a group of centrist Democrats. The bill is now in the House of Representatives to later be signed by President Donald Trump. Meanwhile, US House Speaker Mike Johnson announced on Monday that he thinks they have the votes to pass the stopgap.

News on the US federal government reopening is likely to impact financial markets, alongside the release of American data, once the stalemate is over.

Other than that, New Zealand will release a quarterly inflation update early on Tuesday, while the United Kingdom (UK) will publish monthly employment-related figures during the upcoming European session.

XAU/USD short-term technical outlook

The 4-hour chart for the XAU/USD pair shows it retains most of its intraday gains, trading just below the $4,100 level. In the mentioned time frame, the 20 Simple Moving Average (SMA) turns higher but remains below the 100- and 200-period SMAs; the 100 SMA continues to decline while the 200 SMA edges up. Price holds above all three, reinforcing a bullish near-term tone. At the same time, the Momentum indicator climbs above its midline, indicating strengthening buying pressure. Finally, the Relative Strength Index (RSI) turned flat within overbought levels, and could temper upside in the near term. Initial support sits at the 100-period SMA at $4,052.58.

In the daily chart, XAU/USD is advancing beyond a flat 20-day SMA at around $4,082.65, while the 100- and 200-day SMAs continue to rise at $3,621.50 and $3,383.46. Additionally, the Momentum indicator heads north almost vertically, but remains below the 100 line. The RSI, in the meantime, accelerates north at around 57, aligning with a moderately bullish tone. A sustained hold above the 20-day SMA could maintain the upside bias, towards the record high in the $4,380 price zone.

(This content was partially created with the help of an AI tool)