(Kitco News) – Gold took everything the market could throw at it this week, stood its ground, and kept rising, leading market participants to question whether anything can stand in the way of the yellow metal’s recent rally.
Spot gold kicked off the week trading at $3,687.74 per ounce, and the yellow metal trended in a $10 range before successfully breaking above $3,700 just after 2:00 a.m. Eastern.
Gold saw strong momentum in the Asian and European sessions, and by the North American open, the spot price was trading at $3,717 per ounce, whereupon American traders picked up where Asia and Europe left off, and by the equity closes on Monday, spot gold was trading at $3,745.
The bulls’ momentum failed just short of $3,760 per ounce not long after the Asian open, but gold successfully broke through just after 4:00 a.m. Tuesday, rocketing prices to the very edge of $3,790 per ounce and the weekly high.
The yellow metal completed a triple top at this resistance level just half an hour before the North American equity open, so prices trended lower throughout the day on Tuesday, with spot falling to $3,756 per ounce just before 3:00 p.m., and $3,752 early in the Asian session. Another push to challenge $3,780 failed just before 4:00 a.m., leading to another sharp slide coinciding with the North American open, which saw gold fall to a midweek low of $3,718 per ounce by 3:15 Wednesday afternoon.
This level proved to be the turning point for gold, however, as the yellow metal was right back up to $3,750 by the Asian open, but momentum once again stalled at $3,757, leading to a now-familiar pattern of prices falling just ahead of the North American open on Thursday.
But this time, American traders were buying, and spot prices were bumping up against $3,755 per ounce by 3:00 p.m. Eastern.
Once again, momentum stalled, but this time the bears were only able to drive gold down as low as $3,735 per ounce by 9:00 p.m. Then, Friday’s North American open provided the last big push for the week, taking prices from $3,751 per ounce when the PCE inflation report was released at 8:30 a.m. all the way to $3,784 per ounce just before 2:00 p.m. Eastern.
After a round of moderate profit-taking, spot gold stabilized near $3,765 per ounce, where it traded into the weekly close.
The latest Kitco News Weekly Gold Survey showed Wall Street sentiment as bullish as it’s ever been after gold gained despite numerous headwinds, while Main Street investors grew moderately more optimistic about the precious metal’s near-term prospects.
“Up,” said Darin Newsom, senior market analyst at Barchart.com. “Why? I’ve made it a habit to not step in front of runaway trains. It’s better for one’s health.”
“I am bullish on gold for the coming week as it remains in a secular uptrend against all currencies,” said Colin Cieszynski, chief market strategist at SIA Wealth Management.
“Up,” said Rich Checkan, president and COO of Asset Strategies International. “Despite the fact that some are starting to suggest that gold is overbought, the trend remains our friend into next week. Central banks are not slowing down. And… as you can see from the falling Gold/Silver Ratio (GSR), retail investors are in the early stages of beginning to wake up. Retail investors buy gold AND silver. Silver is moving. Guess who is starting to buy?”
“Throw in a looming U.S. government shutdown and an inevitable over-spending bill, and I see higher prices for gold again next week.”
“Up,” said James Stanley, senior market strategist at Forex.com. “There’s no reason to question the trend now. There might be a pause at 3800 in spot, but it’s now about 91% from last year’s low, so I’m going to continue to default to the dominant trend until there’s some evidence to suggest otherwise.”
Up,” said Adrian Day, president of Adrian Day Asset Management. “The economic narrative in the U.S. is slowly turning, though today’s consumer spending and inflation reports did not help. Indeed, the retail sales report helps bolster those on the Federal Reserve who do not want another rate cut next month, and that would disappoint a market already pricing in another cut. However, the U.S. economic narrative, and pace of rate cuts, are clearly less important to gold than other factors.”
“The ongoing shift away from the dollar as the prime global reserve asset is the most important factor, and that is continuing,” Day added. “We may see a breakout soon.”
Kevin Grady, president of Phoenix Futures and Options, said the market dynamics are firmly bullish in gold’s favor right now.
“I think the message just continues to be that it's just all about interest rates, how many cuts they are going to be,” he said. “And that's what the market wants, and what gold's reacting to. But I think gold's issue, too, is that the weaker dollar is just propelling gold.”
Grady said all of this adds up to higher prices for the yellow metal. “$4,000 is right here,” he said. “I don't know who's going to step in front of it to stop it, but I think there's people that are buying it.”
He said geopolitics continues to play a supportive role in precious metals markets. “Last year, the largest purchaser of gold was Poland,” he noted. “You look at what happened with Russia, where they've sent drones over the border, and I think a lot of these things are going to continue. I think these countries realize now that they have to beef up everything: security, their balance sheets, everything.”
Grady agreed that all the pressures that drove the first half of this gold rally before things slowed down in April are back on right now – and the big buyers aren’t looking to sell at any price.
“Right now, the market is in strong hands,” he said. “It's not saying ‘What is going to force a central bank to stop buying?’ It's more, ‘What's going to force them to sell?’ And that's not going to happen. They're trying to diversify their assets; this is a national security issue. These guys are not trading. They're not saying, ‘Hey, we're up X amount.’ It's, ‘We're trying to move our reserves into a stable product.’ And it's working; they see it. It's at all-time highs. Even if they slowed down purchases because of price, the logic of the trade hasn’t changed.”
“I think that's the way you have to look at the market, especially when you're trading,” Grady said. “You always have to identify who are the big players, and what are they doing? Who are the strong hands, who are the weak hands? That's how you make a decision on what you want to do.”
“I think right now the market is in very strong hands, so I don't see this changing.”
This week, 19 analysts participated in the Kitco News Gold Survey, with Wall Street won over by gold’s strong weekly performance. 16 experts, or 84%, expect to see gold prices rise during the week ahead, while not one predicted a price decline. The remaining three analysts, representing 16% of the total, see the yellow metal trading sideways next week.
Meanwhile, 265 votes were cast in Kitco’s online poll, with Main Street investors growing more bullish, but nowhere near the degree of their professional counterparts. 166 retail traders, or 63%, looked for gold prices to rise higher next week, while another 56, or 21%, predicted the yellow metal would lose ground. The remaining 43 investors, representing 16% of the total, expected prices to consolidate during the week ahead.
After a week of worsening inflation data did little to stand in the way of the market’s rate-cut optimism – and gold’s concurrent gains – next week will see employment once again in focus.
Monday will see the release of Pending Home Sales for August, followed by JOLTS Job Openings and Consumer Confidence on Tuesday.
Then on Wednesday morning, markets will be watching ADP Nonfarm Payrolls, along with ISM Manufacturing PMI a little later, and Thursday will see the release of weekly jobless claims data.
All this serves as a prelude to Friday morning’s Nonfarm Payrolls report for September, with market participants looking to see if the previous months’ weakness continues, and whether the Fed could cut even further in October. The ISM Services PMI will cap the week’s data releases.
“Despite a firmer US dollar and higher US rates, gold remained firm,” said Marc Chandler, managing director at Bannockburn Global Forex. “It set a record high on Tuesday near $3971 and has traded inside Tuesday’s range for the last three sessions, including today. I had thought that the firmer dollar and rates would have spurred some profit-taking on the yellow metal. Its resilience suggests the buying enthusiasm has not been exhausted.”
“Heightened geopolitical tensions in Eastern Europe, more US tariffs, and the strong chance of the US federal government shutdown, seem to favor gold,” Chandler added. “Support is seen in the $3715-20 area.”
Adam Button, head of currency strategy at Forexlive.com, said the price action itself is the real story.
“This week was a big test for gold,” Button said. “The data was all hot. It wasn't just [Friday’s PCE and consumer sentiment]. We had new home sales were hot. GDP was good. Durable goods orders were good. Then you had a massive wave of profit-taking that all came in a massive wave. You had profit taking in the Nasdaq and stocks in general. The dollar is up a little more than 1% this week.”
“The news flow ran entirely against gold this week, and yet it rallied anyway,” he said. “So the message from the gold market this week is that you don't need a softer U.S. dollar or big Fed cuts to sustain the gold rally. Yes, it's certainly good to have those things, but the gold market is rallying for so many reasons that removing any one of them at a time isn't enough to halt it.”
Button said gold bulls were holding their breath this week after several weeks in a row of strong gains. “Every other market started taking profits, and it would've been natural to see 3% drop, 5%, whatever in gold, but it's held up,” he said. “You can point to some of these things, like Comey and a few others, as drivers, and I'd agree. But on the pure economic side, it was a bad news week for gold. Yet they rallied.”
Button said that traders are looking at gold’s performance this week – especially with the dollar strengthening – and they can’t justify not buying.
“This will be six weeks in a row of gains,” he said. “Yes, gold is way out over its skis, it's overbought on the technical measures, but when the window opens for a correction, that just doesn't happen. Central banks aren't buying on the RSI.”
“Listen, as a gold bull, I'd love to see a $300 pullback – to buy,” he added. “But you don't want to be waiting for a $300 pullback, and watching it go to $4,000 or $5,000.”
The fact that the gold miners are really rallying now is also a clear signal to Button that retail is getting involved.
“I think it's a new chapter right now that's unfolding,” he said. “And I don't think it's the last chapter. It might be the back half of the book, but with retail getting involved, things get a lot more volatile, and we're probably in that kind of phase now.”
Button said anyone who’s been long technology stocks and precious metals in 2025 has done very well.
“That's such a barbell, you just go long tech, long gold,” he said. “And okay, a lot of great things are happening in tech, rah-rah, good luck to them, I hope it all works out. But if it all goes to [hell] or we end up in some dystopian future, I want to hold gold. You've just got a barbell strategy right there. That's the trade of the year.”
Alex Kuptsikevich, senior market analyst at FxPro, expects gold prices to rise once again next week.
“Gold is trading near record highs, while price pullbacks are attracting new buyers,” he said. “Two key drivers behind the gold rally are a change in the Fed's outlook and geopolitics. Jerome Powell emphasises that, given the bilateral risks, the central bank cannot take a risk-free path. Choosing between supporting full employment and inflation control, the Fed now turns its attention to the former. Gold is considered a hedge against inflation. However, the Fed is the main defender against price acceleration and rising rates. In such conditions, gold often falls. However, when the central bank washes its hands of the matter, gold spreads its wings. This was the case in 1979, when it jumped 140% due to lower rates against a background of high inflation.”
Kuptsikevich said the same thing is happening today. “Donald Trump has abandoned the idea of quickly ending the armed conflict in Ukraine,” he noted. “This is leading to a bipolar world, intensifying the processes of de-dollarisation and diversification of gold and foreign exchange reserves, which is adding fuel to the fire of the gold rally.”
Michael Moor, founder of Moor Analytics, believes the most likely path for gold next week is higher.
“Up, unless we break back below the formation mentioned in the last line below under the lower time frame,” he said. “In a Higher time frame: I cautioned on 8/16/18 the break above $1,179.7-$1,183. warned of renewed strength. We have seen $2,640.9. This is OFF HOLD. On a Medium time frame: The break above 31482 warned of strength for days—we rallied $676.4. The trade above 32214 projects this upward $100 (+)—we rallied $ 603.2. The above are OFF HOLD.”
“On a Lower time frame: The trade above 33411 has brought in $483.5 of strength,” Moor wrote. “The trade above 33850 has brought in $439.6 of strength. The trade above 34186 has brought in $406.0 of strength. The break back above 35640 has brought in $260.6 of strength. The trade above 36658 has brought in $158.8 of strength. The trade above 37143 has brought in $110.3 of strength.”
“Get long on a decent penetration above 37745 (-7 tics per/hour starting at 6:00am) and/or on a pullback thereafter and look for decent strength (a moderate suggestion, as this is a minor formation),” he added. “If we break above here decently and back below decently, look for decent pressure. If we break above 38216-46 and back below, look for pressure.”
And Kitco senior analyst Jim Wyckoff believes the path of least resistance for gold prices remains sideways with an upward tilt. “Steady-higher amid firmly bullish technicals.”
At the time of writing, spot gold last traded at $3,764.91 per ounce for a gain of 0.41% on the day and 3.35% on the week.
