Gold prices opened the week’s trading on a notable increase, rising 2%, heading towards extending their gains for a third consecutive session.

Gold is currently trading near the second weekly resistance level at $4089, which is considered crucial level, as it coincides with the bullish channel’s upper line. If gold stabilizes above this level, it could rally towards $4,140.

On the downside, if gold fails to stabilize above the bullish channel’s upper line, it will lose positive momentum and retest the weekly pivot point at $3986. It should be noted that a break below this level could expose gold to downward pressure, targeting $3943 then $3885.

From a fundamental standpoint, the dollar index fell slightly today after falling for three consecutive sessions, giving gold prices additional support amid market optimism that the U.S. government shutdown could end soon.

Therefore, the spotlight this week is on Washington due to the government shutdown, which is the longest in U.S. history.

The Senate voted 60-40 on Sunday night in a test vote, the first in a series of required measures, to move towards passing legislation to fund the government until at least January 30, 2026.

Democrat support for the vote came chiefly from eight senators, who agreed to a Republican offer to hold a later vote on extending certain healthcare subsidies, as well as assurances that federal workers fired during the shutdown will be brought back.

This move could not come quickly enough for the country’s airlines, as they suffered a third day of government-mandated flight cuts on Sunday after rising air traffic control staffing shortages.

Finally, predictions on the Polymarket platform showed only a 7% probability that the U.S. government shutdown would end between November 8 and 11, while the scenario of it ending between November 12 and 15 held a dominant 86% probability.