Gold (XAU/USD) regains traction near $3,970 in Wednesday’s European session, as investors flock to safety amid a sharp global equity selloff. Renewed fears of an AI market bubble and warnings from top Wall Street bank CEOs about potential corrections have rattled risk appetite, pushing traders toward the shelter of precious metals.

The risk-off wave has reignited demand for Gold, but gains remain capped by a resilient US Dollar and fading hopes of a December Fed rate cut. Federal Reserve Chair Jerome Powell’s recent hawkish tone has driven US yields higher, limiting the metal’s upside momentum.

Meanwhile, the prolonged US government shutdown, now stretching into its fifth week, continues to weigh on confidence, clouding economic visibility and depriving policymakers of crucial data. Investors are watching the ADP Employment Report and ISM Services PMI closely for fresh cues on the Fed’s next steps.

From a technical lens, a sustained move above $3,970 could pave the way for a retest of $3,990–$4,000, while immediate support emerges near $3,930. A decisive break below this zone might expose $3,905, reinforcing short-term bearish undertones.