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The price of gold remained soft over the past week, but the yellow metal managed to stay above the key $4,200 mark, as the weaker US dollar provided a floor under the price. Although gold climbed to six-week highs near $4,260, moderate risk appetite and mixed US data capped further gains.

What Happened Last Week

Gold’s resilience primarily stemmed from a softer US dollar and lower Treasury yields amid weak labor market data, especially the significant drop in ADP employment figures. Markets now anticipate a 90% probability of a Fed rate cut at the Dec. 9-10 meeting.

The dovish rate outlook, combined with broader global uncertainty, revived investor interest in gold’s safe-haven status. Still, an uptick in US yields limited gold’s rally, while the Fed’s potential easing supported it.

The Friday US PCE inflation report for September met estimates at 0.2%, showing signs of cooling inflation. Meanwhile, the UoM Consumer Sentiment exceeded estimates, lending adequate support to the dollar by the end of the week.

What Could Happen Next Week?

Heading into next week, gold's path will depend on how markets react to US macroeconomic data, particularly labor market data and the Fed Chair’s press conference. Moreover, global risk sentiment remained essential, especially following renewed concerns about Russia and Ukraine. The following three scenarios could emerge for gold:

• If the Fed delivers a 25 bps rate cut and signals a dovish path for 2026, prices could surge to recent levels at around $4,260 and even higher.
• If the Fed remains cautious, easing but signaling fewer rate cuts in 2026, gold could fall to $4,150.
• In a risk-off environment, characterized by weaker equities and heightened geopolitical tension, gold could move disproportionately higher, potentially surpassing $4,300.

Structural factors, such as central bank accumulation, rising global debt levels, and inflows into gold-linked financial products, will maintain the medium-term bullish view.

Key Events for Gold Next Week

Below are several high-impact events scheduled for next week:

• US JOLTs Job Openings
• US Weekly ADP Employment
• FOMC Rate Decision
• Fed Chair Press Conference
• US Employment Cost Index
• US Jobless Claims

Gold Weekly Technical Forecast: Bearish Flag Pattern
 

(Click on image to enlarge)

Gold daily chart

The daily chart for gold has formed a bearish flag pattern. A breakout of the lower trendline could attract more sellers and look to complete the pattern at the $3,800 mark. However, several key support levels have emerged in between, making the bearish path bumpy.

Meanwhile, the daily RSI has stayed above 60.0, suggesting potential room for more gains. While staying above the key MAs, the odds of upside remain high, with eyes on the $4,300 mark ahead of all-time highs at around $4,380.

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