Gold Price Analysis: XAU/USD rally extends into $2,040 as Fedspeak sparks Fed pivot bets

Spot Gold is lurching higher as broad markets go risk-on, tipping into $2,040.
Fedspeak is bolstering market bets that interest rates will be coming down sooner than expected.
Fed Governor Waller sparked investor expectations of a pivot in the Fed's rate outlook.

Joshua Gibson FXStreet

Gold prices climbed on Tuesday in their best single-day performance in over six weeks, climbing 1.5% on the day and settling at a seven-month peak of $2,044.

Markets saw a risk rally as investor sentiment bid up assets across the board, sparked by Dovish Fed comments in the early US market session that sent Gold climbing on the day.

Fed's Waller sees no need to insist on high rates

Federal Reserve (Fed) Governor Christopher Waller noted on Tuesday that as long as inflation continues to fall back towards Fed targets, there's no reason to continue forcing rates to remain higher for longer.

The offhand comment made during a conversation with Michael Strain, Director of Economic Policy Studies, at the American Enterprise Institute was all it took to spark a risk bid in US markets, sending Gold, equities, and risk assets climbing while the US Dollar declined.

Fedspeak is sparking bets that the Fed will be pivoting from their "higher for longer" stance on interest rates, increasing market hopes for an accelerated path towards Fed rate cuts sooner rather than later.

XAU/USD Technical Outlook

Spot Gold has tipped into seven-month highs above $2,040 and has climbed almost 13% from October's lows near $1,810.

XAU/USD continues to rally after catching a bounce from the 200-day Simple Moving Average (SMA) near $1,940, and a bullish lean in average price gains is pushing the 50-day SMA into a bullish crossover of the 200-day SMA.

The last higher low is etching in a rising trendline from October's lows, and sellers will need to break through rising technical support in order to challenge near-term bullish momentum.

XAU/USD Daily Chart

XAU/USD Technical Levels

XAU/USD

Overview
Today last price	2043.28
Today Daily Change	28.86
Today Daily Change %	1.43
Today daily open	2014.42

Trends
Daily SMA20	1977.11
Daily SMA50	1936.65
Daily SMA100	1934.33
Daily SMA200	1941.58

Levels
Previous Daily High	2018.2
Previous Daily Low	2000.65
Previous Weekly High	2007.63
Previous Weekly Low	1965.51
Previous Monthly High	2009.49
Previous Monthly Low	1810.51
Daily Fibonacci 38.2%	2011.5
Daily Fibonacci 61.8%	2007.35
Daily Pivot Point S1	2003.98
Daily Pivot Point S2	1993.54
Daily Pivot Point S3	1986.43
Daily Pivot Point R1	2021.53
Daily Pivot Point R2	2028.64
Daily Pivot Point R3	2039.08

Author

Joshua Gibson

FXStreet

Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

Editor's Picks

EUR/USD moves sideways below 1.1800 on Christmas Eve

EUR/USD struggles to find direction and trades in a narrow channel below 1.1800 after posting gains for two consecutive days. Bond and stock markets in the US will open at the usual time and close early on Christmas Eve, allowing the trading action to remain subdued.

GBP/USD keeps range around 1.3500 amid quiet markets

GBP/USD keeps its range trade intact at around 1.3500 on Wednesday. The Pound Sterling holds the upper hand over the US Dollar amid pre-Christmas light trading as traders move to the sidelines heading into the holiday season.

Gold retreats from record highs, trades below $4,500

Gold retreats after setting a new record-high above $4,520 earlier in the day and trades in a tight range below $4,500 as trading volumes thin out ahead of the Christmas break. The US Dollar selling bias remains unabated on the back of dovish Fed expectations, which continues to act as a tailwind for the bullion amid persistent geopolitical risks.

Bitcoin slips below $87,000 as ETF outflows intensify, whale participation declines

Bitcoin price continues to trade around $86,770 on Wednesday, after failing to break above the $90,000 resistance. US-listed spot ETFs record an outflow of $188.64 million on Tuesday, marking the fourth consecutive day of withdrawals.

Economic outlook 2026-2027 in advanced countries: Solidity test

After a year marked by global economic resilience and ending on a note of optimism, 2026 looks promising and could be a year of solid economic performance. In our baseline scenario, we expect most of the supportive factors at work in 2025 to continue to play a role in 2026.

Avalanche struggles near $12 as Grayscale files updated form for ETF

Avalanche trades close to $12 by press time on Wednesday, extending the nearly 2% drop from the previous day. Grayscale filed an updated form to convert its Avalanche-focused Trust into an ETF with the US Securities and Exchange Commission.