Gold Price Hits $4,400: Why Bulls Eye $4,443 as Fed Bets Shift Again
Gold surged to a fresh record near $4,400 during early European trading on Monday, extending its rally as markets...
Quick overview
- Gold prices reached a record high near $4,400, driven by a more accommodative US policy outlook and rising geopolitical tensions.
- Softer inflation and cooling labor data suggest US interest rates may peak sooner, supporting gold's appeal as a safe-haven asset.
- Geopolitical uncertainties, particularly in the Middle East and Venezuela, have reinforced demand for gold as a hedge against political and energy-related risks.
- Technically, gold remains in a bullish trend, with immediate resistance at $4,410 and support established around $4,373.
Gold surged to a fresh record near $4,400 during early European trading on Monday, extending its rally as markets price in a more accommodative US policy outlook and rising geopolitical risk. Softer inflation signals and cooling labour data have strengthened the case that US interest rates may peak sooner than previously expected, keeping real yields contained and gold well supported.
That said, thin holiday liquidity and record-high price levels mean short-term volatility remains possible. While the broader trend stays firmly bullish, some traders may lock in profits near highs, creating brief pullbacks without undermining the underlying structure.
Geopolitics Reinforce Safe-Haven Demand
Beyond monetary policy, geopolitics continue to play a decisive role. Tensions in the Middle East remain elevated after reports that Israel is preparing to brief US President Donald Trump on potential options involving Iran, according to Reuters. The backdrop has kept investors cautious, reinforcing gold’s appeal as a defensive allocation.
Uncertainty has also intensified around Venezuela. US officials told Reuters that Washington is pursuing another oil tanker as the Trump administration escalates pressure on Nicolás Maduro’s government. Combined, these developments have sustained demand for gold as a hedge against political and energy-related shocks.
Fed Signals and US Data Keep Gold Supported
Federal Reserve messaging has leaned toward patience rather than urgency. Cleveland Fed President Beth Hammack said rates are in a good position to pause, noting the need to assess the impact of 75 basis points of cuts already delivered earlier this year. Market pricing reflects that caution. The CME FedWatch tool shows just a 21% probability of another rate cut at the January meeting.
Meanwhile, US data has added to growth concerns. The University of Michigan Consumer Sentiment Index was revised down to 52.9 for December, missing expectations and reinforcing the narrative of slowing demand. This week, traders will monitor the Chicago Fed National Activity Index and preliminary Q3 GDP, forecast at 3.2% q/q, down from 3.8%, for confirmation.
Gold Price Forecast: Breakout Holds Above $4,373
From a technical perspective, gold’s structure remains decisively bullish. XAU/USD is trading near $4,401 after breaking higher from a short consolidation phase. The latest bullish candle closed near its high, confirming follow-through buying rather than a false breakout.
Price is holding comfortably above the 50-EMA at $4,333 and the 100-EMA near $4,304, while former resistance around $4,373 has flipped into support. Gold remains within a rising channel that has guided the uptrend since late November.
Immediate resistance sits near $4,410, followed by $4,443, aligned with a key Fibonacci extension. RSI near 74 signals strong momentum without clear signs of exhaustion.
Trade idea: Buy pullbacks toward $4,375, targeting $4,443, with invalidation below $4,333.
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