Gold prices rose after triggering buy orders near the $2,580 level on Thursday. On Friday, the precious metal closed above the uptrend line drawn from the June 26 low. Despite the continued advance, gold remains below the 50-day exponential moving average (EMA) and is currently trading within a neutral range between $2,580 and $2,720.
This neutral outlook is further supported by momentum indicators. The Relative Strength Index (RSI) showed a rebound, but remains below the 50-mark, while the Moving Average Convergence Divergence (MACD) also indicates signs of a bottoming trend. However, the MACD remains below both its zero and trigger lines, signaling that while negative momentum may be slowing, there is no indication yet that bullish momentum is taking hold.
For a more bullish scenario to unfold, gold prices would need to break above the key resistance level of $2,720. A move above this threshold could set the stage for a push towards the record high of $2,791.07, and potentially higher levels in uncharted territory. However, before that, bulls will likely face a significant challenge around the 50-day EMA.
On the downside, a drop below $2,580 would signal a return below the uptrend line. A more bearish scenario could emerge if gold closes below $2,530, a level that acted as strong resistance from August 20 to September 11. A decisive break below $2,530 could set the stage for further declines, potentially targeting the September 4 low near $2,470.
In summary, while gold has rebounded and is holding above the June 26 uptrend line, a bullish outlook hinges on a sustained move above the $2,720 resistance zone.
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