Gold keeps climbing. Early Wednesday in Asia, it broke above $3,950, riding a wave of investors looking for safety as the US government shutdown inches toward a record 36th day. People are nervous—not just about Congress failing to get its act together, but about the overall economic scenario too. It’s a precarious, shaky economic situation, and gold is starting to look good again.
This shutdown is now six weeks old. Lawmakers have tried—and failed—fourteen times to agree on temporary funding. With no end in sight, investors keep shifting into tangible assets klike gold. However, still, there’s a ceiling. The US dollar is pretty strong right now, and hopes for more Fed rate cuts have faded. Both of those hold gold back. Gold becomes more expensive for foreign buyers when the dollar is strong, which can cause demand to decline.”
All eyes are on the next round of US economic data. October’s ADP private payrolls and the ISM Services PMI are up next, and everyone’s hoping for a hint about what the Fed’s planning. The ADP numbers point to about 25,000 new jobs—nothing wild, but enough to move the dollar, and with it, gold.
From a technical standpoint, gold appears stable above its 100-day EMA. Although that is a bullish indication, momentum feels neutral because the RSI is stuck close to the middle. If it breaks through, resistance is at $4,000, followed by $4,046 and $4,155. Support is located at $3,835 on the downside and $3,722 if things truly get bad.
