Gold (XAU/USD) is trading flat above the $3,850 mark on Friday, paring back modest losses from the Asian session as mixed market drivers keep the precious metal range-bound. The safe-haven asset remains supported by expectations of Federal Reserve (Fed) rate cuts and ongoing geopolitical risks, though a positive risk tone and a firmer US Dollar (USD) are capping upside momentum.
Risk-on sentiment limits gold demand
Despite the partial US government shutdown entering its third day, global equity markets have maintained a positive tone, with Wall Street hitting fresh record highs earlier this week. The upbeat sentiment spilled over into Asia, weighing on safe-haven demand for gold. In addition, a rebound in the USD from a one-week low reached on Thursday added to pressure on the non-yielding metal.
Fed policy outlook and geopolitics cushion downside
Traders continue to price in two more Fed rate cuts this year, with October and December widely expected, following weak private-sector employment data earlier this week. The prospect of lower US rates is helping to limit gold’s downside, while geopolitical tensions — including reports that Washington will provide Ukraine with intelligence support for long-range strikes on Russian energy assets — are keeping safe-haven flows in play.
Technical outlook: key levels to watch
From a technical perspective, gold is consolidating after retreating from its all-time peak near $3,897. Immediate support lies at $3,820–3,819, with a decisive break lower exposing $3,800 and then the $3,758–3,757 zone. Further weakness could target the $3,735 level and the $3,700 psychological mark.
On the upside, resistance is seen around $3,863–3,865, followed by a retest of the $3,896–3,897 all-time high. A sustained move above $3,900 would likely trigger fresh bullish momentum and extend the metal’s multi-week uptrend.
