Gold’s upward trajectory persisted in early Monday trading, extending last week’s impressive 4% advance and reaching a new record high of $2354. This surge has generated a strong bullish signal, especially with a weekly close above the psychological barrier of $2300.
The precious metal continues to benefit from robust safe-haven demand and the prevailing expectation that the Federal Reserve will initiate rate cuts, potentially as early as June, which has been a contributing factor in weakening the dollar.
Since the beginning of the year, gold has surged by almost 14%, with the most significant acceleration occurring in March, where prices spiked nearly 10%, marking the largest monthly gains since July 2020.
Despite technical indicators signaling strongly overbought conditions across various timeframes (daily, weekly, and monthly), bullish sentiment remains dominant. Bulls are now eyeing the next target at $2400, although some corrective action is anticipated given the rapid ascent.
In terms of support levels, the previously breached $2300 barrier now acts as initial support, followed by the rising 10-day moving average ($2256). Additionally, strong support is expected around the $2200 zone, which encompasses the rising 20-day moving average and psychological support level. These support levels are likely to contain any downward corrections and signify a healthy correction within the broader uptrend.
