Key Takeaways:
Gold rose to $4,138.00 per ounce on Thursday, up 1.9% from Wednesday's low of $4,021.00, as buyers tested the 20-day moving average for a second consecutive session.
"The move suggests that the 20-day moving average may again be reclaimed as support," Bruce, a CMT charter holder with over 20 years of experience in financial markets, said.
The yellow metal established a higher daily high and higher low on Thursday, with a close above $4,134.00 needed to confirm the reversal signal. The 20-day moving average has been tested over the past week, while the 50-day moving average sits at $4,362.00. The 50% retracement at $4,358.00 and the 127.2% Fibonacci projection near $4,354.00 provide additional confluence at that level. Spot gold traded at $4,108.18 during the European session, up 0.76%, as the dollar backed off to 100.98 on the Dollar Index.
A decisive breakout above $4,203.00 would trigger a bullish continuation, with the 50-day moving average at $4,362.00 as the first primary target. Conversely, a drop below Thursday's low of $4,054.00 and Wednesday's low of $4,021.00 would weaken the developing higher swing low structure, exposing support at $3,942.00 and $3,886.00.
Resistance at $4,203 Holds the Key
The $4,203.00 level represents the recent lower swing high, and an advance above it is needed before an upside continuation is clearly indicated. A rise above Tuesday's high of $4,181.00 would put gold more clearly above both the 20-day average and the long-term trendline. HSBC cut its 2026 gold forecast to $4,560.00 from $4,864.00, expecting a $3,800.00 to $4,700.00 range for the rest of the year, with the bank citing repriced monetary policy and dollar strength as headwinds that are already priced in.
The near-term support zone between $4,072.40 and $4,041.75 is being tested as buyers attempt to establish a secondary higher bottom. A sustained move above $4,072.40 would indicate the presence of buyers, while a break below $4,041.75 could trigger a test of the $3,942.00 to $3,886.00 support area. Next week's CPI release and congressional testimony will be the next catalysts for direction.
This article is for informational purposes only and does not constitute investment advice.
