Article by: ETO Markets
Gold prices continue to navigate near elevated levels, currently trading around $… after a notable pullback from the record high of $… set earlier in the week. The precious metal's strong performance throughout 2025 has been fundamentally underpinned by significant US dollar weakness, persistent central bank gold accumulation driven notably by emerging economies, and heightened geopolitical uncertainties stemming primarily from US-China trade relations and Middle East instability, which bolster its safe-haven appeal. Persistent inflation concerns also provide support, positioning gold as a hedge. However, recent price action reflects some headwinds, including profit-taking near the record highs and the potential for upcoming strong US economic data, such as this week's GDP and PCE figures, which could temper expectations for imminent Federal Reserve rate cuts. Market sentiment, reflected in slightly increased speculative net long positions, remains broadly constructive, although caution prevails given the high price levels and significant volatility, underscored by the elevated VIX and recent large daily price swings in gold itself.
From a technical standpoint, Gold (XAU/USD) found footing near the $… level yesterday after its retreat from the $… peak. The immediate resistance pivot lies near the intraday high of $…, which corresponds roughly to the 23.6% Fibonacci retracement of the recent rally. A sustained move above this could target the psychological $… mark. Key support is currently forming around the $… level down to the intraday low of $…, which is near the calculated 38.2% Fibonacci support at $…. A breach below this could expose yesterday's low at $…, followed by the 50% Fibonacci retracement level around $…. While the price remains above crucial moving averages like the 9-day EMA ($…) and 20-day SMA ($…), suggesting underlying strength, indicators present a mixed short-term picture. The RSI (14) at 64.00 has cooled from recent overbought conditions, and the Stochastic oscillator (69.45) has crossed below its signal line (78.94) from overbought levels, signalling potential for further consolidation or a near-term dip.
