The gold price today per tael, still needs the US dollar to reach $4,300

Strong Signal from Technical Release, Short-term Clear Targets

Gold performs excellently on the technical front. The 2-hour chart shows that the price remains firmly above the short-term upward trend line. The current key support level is in the $4140-$4160 range, where bulls and bears are engaged in a tug-of-war. Once gold effectively breaks through the $4160 threshold, the subsequent rebound space will open up, and investors can look forward to further upward movement toward $4220, or even challenge the important resistance level at $4300. Conversely, if it falls below the $4140 support, increased risk of a pullback should be anticipated.

Labor Market Deterioration, Rate Cut Expectations as Support

The fundamental driver behind today’s slight rise in gold prices comes from signals of economic softening in the US. The latest data shows that the US September non-farm unemployment rate has risen to 4.4%, with corporate layoffs accelerating—October announced layoffs reached 153,000, a month-on-month increase of 183%, setting a record since 2003, and a year-on-year increase of 175%. This series of negative employment data has strengthened market expectations for a rate cut by the Federal Reserve in December. According to the CME FedWatch tool, the market is betting nearly 85% on a 25 basis point rate cut.

The government shutdown further limits the release of new data, meaning Fed decisions will mainly be based on current data. Against the backdrop of rising AI bubble speculation and slowing economic growth, easing policies are highly probable.

US Treasury Yields Fall Below 4%, but Limited Room for Dollar Weakness

The 10-year US Treasury yield has fallen below the critical 4% level, which should support gold. However, investors need to be cautious of the potential reverse effect of “long-term risk premium”—despite short-term rate cut expectations dominating the market, ongoing US government debt issuance and potential inflation risks could push long-term bond yields higher, limiting further declines in US Treasury yields.

Structural Factors for Dollar Weakness Emerge

The dollar’s rally faces multiple constraints. On one hand, the next Fed chair candidate leans toward dovish economists, implying the Fed’s rate cut cycle next year could be more extensive than expected. On the other hand, new international variables have emerged—Japan plans to issue at least 11.5 trillion yen in additional government bonds, raising concerns about Japan’s fiscal deterioration. Long-term Japanese bond yields hit a 20-year high, and the yen continues to depreciate. The Japanese government and central bank have issued verbal intervention warnings. This means the short-term upward momentum of the dollar will be substantially restrained, providing support for dollar-denominated gold.

Institutional Target Prices Continue to Rise, but Risks Coexist

Deutsche Bank’s latest forecast raises the average gold price target for next year from $4,000 to $4,450, with an estimated range of $3,950 to $4,950. If gold reaches $4,950, it will be about 14% higher than the expected year-end futures price. Recent technical adjustments reflect clear support at the $3,900 level, with supply growth remaining moderate.

However, investors should also be aware of downside risks: if the stock market experiences a deep correction but the Fed’s rate cuts are fewer than expected, or if central banks significantly slow their gold purchases, gold could face a correction.

Summary

Today’s slight rise in gold prices reflects the combination of US economic weakness and dollar softness, while the challenge at $4,300 requires further policy confirmation. The technical upward trend line remains intact, with $4,160 as a key breakout point. Investors should closely monitor US Treasury yields and the dollar index performance.