Gold Surges Toward Record Highs as Fed Easing Bets Drive Bullion Gains

Summary:

Gold extends its rally amid Fed easing expectations and geopolitical uncertainty, approaching all-time highs above $4,300.

Buy XAUUSD

End Time

CLOSED

4329.77

ENTRY

4381.00

TGT

4300.00

4342.99 +43.60 +1.01%

2977

Points

Loss

4300.00

4299.94

CLOSING

4329.77

ENTRY

4381.00

TGT

Gold (XAU/USD) continued its bullish momentum on Friday, pushing toward record territory as traders recalibrate expectations for the Federal Reserve’s monetary policy in 2026. At the time of writing, XAU/USD is hovering around $4,337, just shy of its all-time peak of $4,381 recorded on October 20. This advance comes in the wake of Wednesday’s 25 basis points (bps) rate cut by the Fed, the third reduction this year, which has reignited speculation that the U.S. central bank could deliver additional easing next year.

The latest leg higher allowed Gold to decisively break out of a two-week consolidation range, signaling renewed appetite for the safe-haven asset amid a backdrop of dovish monetary signals. While the Fed refrained from providing explicit forward guidance, Chair Jerome Powell’s comments underscored a cautious approach: near-term rate hikes are unlikely, and future policy will remain data-dependent. Powell highlighted both upside and downside risks to the U.S. economy, reinforcing a nuanced stance that markets interpreted as more dovish than expected.

This divergence between market expectations and the Fed’s official projections has fueled aggressive positioning in favor of further easing. Traders are now pricing in the likelihood of two additional rate cuts in 2026, even as the Fed’s latest dot plot indicates only one cut. Analysts suggest that this gap between expectations and official guidance could sustain heightened volatility for Gold, especially given its sensitivity to U.S. interest rate differentials.

Beyond monetary policy, geopolitical tensions continue to underpin bullion demand. Concerns over persistent global uncertainties, including ongoing conflicts and trade disruptions, have maintained a steady risk premium on Gold, supporting its ascent even as equities and other risk assets show mixed performance.

Technical Analysis

From a technical perspective, XAU/USD’s momentum has strengthened in intraday trading, breaking above the key resistance level of $4,300. This level, previously highlighted as a potential target in our analysis, now acts as a short-term support, reinforced by the 50-day exponential moving average (EMA50). On the minor trend line scale, Gold continues to track higher, suggesting that bullish sentiment remains intact.

However, the Relative Strength Index (RSI) has entered overbought territory, indicating that the pace of gains may be slowing and that short-term pullbacks could occur. Traders should watch for consolidation above the $4,300 threshold, as sustained trading at or above this level would increase the likelihood of a test of the all-time high at $4,381. Conversely, failure to maintain momentum could trigger a retest of immediate support zones near $4,250 and $4,220.

TRADE RECOMMENDATION

BUY GOLD

ENTRY PRICE: 4330

STOP LOSS: 4300

TAKE PROFIT: 4381

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Warren Takunda

Analysts

Warren Takunda, a seasoned finance leader specializing in the Middle East, is a trusted senior analyst with a proven track record. As head of the finance team, he excels in financial planning, analysis, and reporting. Warren's expertise in financial modeling and investment analysis delivers valuable insights to clients.

Rank

Articless

1928

Win Rate

63.74%

P/L Ratio

0.72

Focus on

XAUUSD, EURUSD, GBPUSD

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