Gold extends its powerful rally, hitting a new record high. Macro tailwinds and declining real yields continue to fuel the potential bullish acceleration outlook.
Chart of the week: Gold
Key takeaways
- Gold extends powerful rally: XAU/USD has surged 12.6% month-to-date, breaking past the US$4,084/4,122 resistance zone to a new record high of US$4,381 amid strong bullish momentum.
- Macro tailwinds stay supportive: Persistent US inflation, fiscal concerns, and declining real yields continue to fuel the “debasement trade,” strengthening gold’s appeal as a hedge.
- Bullish bias intact above key support: The medium-term uptrend remains valid above US$4,056, with next medium-term resistances at US$4,500/4,560 and US$4,650/4,665.
In our “Monthly Tactical Views for October” published on 30 September 2025, we have highlighted gold (XAU/USD) as one of our asset picks to watch due to its potential bullish acceleration outlook.
The precious yellow metal has shaped the expected bullish impulsive up move sequence, recording a month-to-date gain of 12.6% as of 21 October 2025 at the time of writing, surpassing the US$4,084/4,122 medium-term resistance highlighted in our prior publication, and hit a fresh all-time intraday high of US$4,381 on 20 October 2025.
The macro narrative that is supporting the ongoing major bullish trend in gold (XAU/USD) has been a sticky inflation trend in the US (as an inflationary hedge), and “debasement trade” where growing fiscal concerns in the world’s biggest economies, such as the US, led to a bet against fiat currencies.
Read more on gold: Why Singaporeans are turning to gold: An analysis of the precious metal
A lower long-term real interest rate acts as a tailwind for gold
Fig. 1: 10-year US Treasury real yield with gold (XAU/USD) major trend as of 21 Oct 2025 (Source: TradingView).
The 10-year US Treasury real yield (excluding 10-year breakeven inflation rate) medium-term downtrend remains intact as it remained below its 50-day moving average and 1.87% key medium-term resistance.
Based on intermarket analysis, a cap on any further rebound in the 10-year US Treasury real yield below 1.87% and a break below 1.66% intermediate support reduces the opportunity costs of holding gold (XAU/USD) as it is a non-income-bearing asset, in turn, creating a further positive feedback loop back into the price actions of gold (XAU/USD) (see Fig. 1).
Bullish momentum factor remains intact
Fig. 2: Gold (XAU/USD) medium-term trend as of 21 Oct 2025 (Source: TradingView).
Current key technical elements suggest that the gold (XAG/USD) medium-term uptrend phase, in place since the bullish breakout of its former “4-month Ascending Triangle” range resistance on 2 September 2025, remains intact.
Current price actions continue to trade above its rising 20-day and 50-day moving averages. In addition, the 4-hour RSI momentum indicator of gold (XAU/USD) has not flashed out any bearish divergence condition at its overbought region and managed to stage a rebound from its ascending support on Friday, 17 October 2025 (see Fig. 2).
Watch the US$4,056 key medium-term pivotal support on gold (XAU/USD) and a clearance above US$4,381 (current all-time high) sees the next medium-term resistances coming in at US$4,500/4,560 and US$4,650/4,665 (Fibonacci extension cluster).
On the other hand, a break below the US$4,056 key support invalidates the bullish acceleration scenario for a corrective mean reversion decline to expose the next medium-term supports at US$3,845 and US$3,703 (also the 50-day moving average).
The information presented is historical information, and past performance is not indicative of future performance.
