What can spark gold's next big move?

• Gold has merely risen 0.7% so far in October 2026; -3.1% year-to-date

• Persistent market expectations for more Fed rate hikes have capped gold below $4.2k month-to-date

• XAUUSD now threatening to breach upper downward trendline since late-August

• Bloomberg model: 72% chance XAUUSD trades between $4072 - $4307 through next week (Oct 9-16)

• COMING UP: US consumer price index (CPI) a.k.a. inflation report on Oct 14th may spark gold breakout; watch oil, US dollar, and Treasury yields in the interim



Gold is now threatening to break to the upside.



At the time of writing on Friday, October 9th, XAUUSD is rising 1.3% today, as oil prices and US Treasury yields ease lower.

However, gold remains stuck in a downtrend (a series of lower highs and lower lows) formed since late-August.

And so far in October 2026, gold prices have so far only managed to move sideways, capped by the psychological $4200 price.

Trade Gold perps now

Here's a quick recap of gold's performance of late:

• So far in October: +0.7% month-to-date

• So far in 2026: -3.1% year-to-date

This is in stark contrast to the precious metal's performance last month (Aug 2026) when it soared +9.7% to post its biggest monthly advance since Jan 2026!

READ MORE (published Sept 25th): Here's why Gold has been moving sideways so far in September 2026.



And gold is clearly missing out on the recent surges for the likes of the S&P 500, Nasdaq 100, Nvidia, and AMD - which each hit fresh record highs earlier this week.



Why Has Gold Been Keeping Sideways in October (so far)?



Here are 2 key reasons that explain gold's lackluster performance of late:

• Markets expect the Fed to keep hiking rates

Recall that higher US interest rates tend to cool down demand for gold.

And that's because the precious metal does not pay interest to investors who hold on to gold.

So, gold's appeal has waned following the Fed rate hike on Sept 16th - its first rate hike since 2023.

Although markets do not expect the Fed to hike again until December, markets still expect 2 more Fed rate hikes in 2027.



• Elevated oil, US dollar, and Treasury yields dampen gold's appeal

Since September, Brent oil has resurfaced and remained above the psychologically-important $100/bbl.

Higher oil prices -> higher inflation -> more Fed rate hikes -> stronger US dollar.

Note that the US dollar (as measured by the Dollar Index - DXY) is set for a 4th straight weekly advance - its longest winning streak since March.

With pairs like XAUUSD, the stronger dollar (USD: quote currency, right-side of the pair) weighs down the price of gold (XAU: base currency, left-side of the pair).

And with US Treasury yields at multi-decade highs, zero-yielding gold again is losing its appeal.



What's next for Gold? Watch the US inflation report on Oct 14th



Over the coming week, gold could see an upside breakout if markets are shown:

• a sustained easing of geopolitical tensions, which lowers oil prices and inflation concerns

• a lower-than-expected US inflation report, as measured by the headline consumer price index (CPI) due Wednesday, October 14th @ 12:30 PM UTC.



However, a greater surge in oil prices, and/or higher-than-expected CPI figures may force spot gold to re-test the psychologically-important $4,000 price level for crucial support once more, just like it did between late-June through early-August.

For the coming week (Oct 9th - 16th), Bloomberg's model predicts a 72% chance that XAUUSD will trade between $4072 - $4307.





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