Gold Price Forecast: XAU/USD appreciates beyond $4,200 amid higher Fed cut bets

• Gold hits fresh record highs above $4,200 amid broad-based US Dollar weakness.
• Fed's Powell reiterated his concern about employment, paving the path for further interest rate cuts.
• XAU/USD's rally looks overextended, but there is no sign of reversal as of yet.

Gold is trading higher for the fifth consecutive day on Wednesday, attempting to confirm the breach of the $4,200. The precious metal is trading at $4,193 at the time of writing, after having hit a fresh all-time high at $4,218 earlier on the day.

Bullion is drawing support from a softer US Dollar on Wednesday, following dovish comments by the Fed Chairman Jerome Powell at a speech in Philadelphia. Powell reiterated that the labour market deterioration is more concerning than inflation right now, which practically confirms a rate cut in October and raises expectations of another one in December.

Technical Analysis: No signs of a trend shift in sight 

The technical picture shows Gold skyrocketing. The pair has rallied an eye-watering 27% in less than two months, which normally leads to a correction. The 4-hour RSI is way within overbought territory. So far, however, downside attempts remain limited.

Above the $4,200 level, the 172.2% Fibonacci extension of the October 1.14 rally is at $4,235, and the 161.8% Fibonacci extension of the same cycle is at $4,300; these are the following potential targets.

Downside attempts remain contained at the previous all-time high near $4170 (Tuesday's high). Further down, Tuesday's low at  $4,090 and the October 8, 9 highs at $4.050 area would come into focus.