Key Points
- Gold traded around $3,860, supported by Fed rate-cut bets and the U.S. shutdown.
- U.S. private-sector jobs fell in September, the largest drop since March 2023.
Gold prices hovered near $3,860 per ounce on Thursday, consolidating close to their record high as investors weighed weaker U.S. labour market data and the fallout from Washington’s political gridlock.
Expectations that the Federal Reserve will continue easing this year provided firm support for the non-yielding asset.
The ADP employment report showed that U.S. private-sector employment declined in September, marking the first consecutive monthly contraction since 2020 and the sharpest drop since March 2023.
The figures reinforced the market’s conviction that the Fed will have to extend its rate-cutting cycle to buffer the slowing economy.
At the same time, the Labor Department confirmed that this week’s nonfarm payrolls report will be delayed due to the government shutdown, depriving the Fed of a critical data point ahead of its late-October policy meeting.
The partial closure of federal offices has raised concerns about the impact on growth, with thousands of jobs now at risk and rising uncertainty fuelling safe-haven demand.
Adding to the backdrop, the Supreme Court’s ruling on the contested status of Fed Governor Lisa Cook is seen as easing some institutional concerns, with investors now less worried about a destabilising leadership change. The decision supports expectations of a dovish tilt in policymaking, at least in the near term.
Technical Analysis
Gold (XAUUSD) is holding firm near record highs, trading at 3868.16, up 0.09% on the day. The metal continues its strong bullish momentum, extending the impressive rally that began in late August, driven by persistent safe-haven demand, softer U.S. yields, and renewed geopolitical uncertainty.
Technically, the uptrend remains intact. Gold is trading well above its 5-, 10-, and 30-day moving averages, with the short-term averages providing strong upward guidance.
The breakout above the 3600 resistance zone has now established a higher base, and momentum suggests buyers are preparing to test new highs beyond 3900. Key support rests at 3720–3750, followed by the breakout floor at 3327.65.
Momentum indicators reinforce the bullish bias. The MACD is deeply positive, with the MACD line holding above the signal line, while the histogram continues to print green, showing sustained upward momentum. However, the steep angle of the rally suggests overextension, meaning short-term pullbacks cannot be ruled out as traders book profits.
Cautious Forecast
In the near term, gold remains a buy-on-dips market, with dips toward 3750–3800 likely to attract fresh buying interest.
A decisive break above 3900 could open the path to the psychological 4000 level, but any pullback below 3720 would be the first sign of weakening momentum.
