Gold prices rose above $4,000 per ounce for the first time ever. Investors seek safety amid mounting economic uncertainty, the ongoing U.S. government shutdown, and growing expectations of an imminent Federal Reserve rate cut, while gold continues its impressive rally this week
Spot gold was recently trading near $4,035 per ounce, marking a 54% rise since the start of the year. The rally has been underpinned by strong central bank demand, weakening confidence in the U.S. dollar, and heightened geopolitical tensions that have pushed investors toward safe-haven assets.
After breaking out of a narrow range in early September, gold has maintained a strong uptrend with only brief pauses.
Technical indicators confirm bullish momentum: the Relative Strength Index (RSI) remains in overbought territory above 85, suggesting robust upward pressure but also signalling that the metal may be due for short-term profit-taking.
The Average Directional Index (ADX) is above 50, reinforcing the strength of the current trend.
Applying the measured move technique, a common technical tool used by traders, projects a potential bullish target of around $4,160 per ounce. This forecast is based on the price movement between February and April, added to the top of the latest trading range, suggesting about 3% additional upside from current levels.
Analysts are also watching key support zones that could come into play during any pullback. The first support level sits near $3,700, corresponding to a previous consolidation zone in September.
If prices drop below this level, further declines could test $3,450, an area of prior resistance that may now act as support. A deeper correction could extend to around $3,250, close to the 200-day moving average, and multiple lows formed between May and July.
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