Gold Price Approaches US$4,200, Still Room to Rally?

Gold prices are improving, driven by United States labour data and easing expectations for Federal Reserve rate hikes. The precious metal is now approaching US$4,200 per troy ounce. This rally follows a 2.2% weekly gain, with prices strengthening after data showed a sharp slowdown in US hiring. Lower interest rates reduce the opportunity cost of holding non-yielding assets like gold. JPMorgan has revised its short-term outlook, cutting its end-2026 price target from US$6,000 to US$4,500 per troy ounce. The investment bank cited weaker-than-expected demand from key buyers as the primary factor for the revision. Despite the downgrade, the bank maintains a long-term bullish stance, forecasting a resumption of the rally in 2027 supported by structural accumulation of reserves by central banks. The metal faces headwinds if US economic data strengthens, potentially prompting more aggressive monetary tightening. Key technical levels to watch include a resistance point at US$4,300, which if broken could push prices to US$4,800. Conversely, a drop below US$3,960 could trigger a decline towards US$3,600. The outlook for gold is also being shaped by its competition with Bitcoin, as central banks globally increase their gold holdings relative to US government bonds.