Gold (XAU/USD) Price Forecast: Momentum Persists as Resistance is Cleared, Sets Fresh All-Time Highs
Gold surged to a record $3,872 high on Tuesday, confirming its breakout. Momentum stayed strong, keeping bulls in control as targets shift toward the $3,969 – $4,000 zone.
Record Highs Confirm Breakout Strength
Gold remained a market leader on Tuesday as it surged to a new record high of $3,872, just shy of the next upside target at $3,896. The breakout followed Monday’s decisive closing above the prior resistance zone capped at $3,791, ending that session at $3,834. With buyers in clear control, momentum carried forward into Tuesday’s session, propelling gold higher while retesting a top channel line as new support.
Support Flip Confirms Bullish Behavior
The session low was a higher daily low and coincided with a bounce from the top channel line — a key level that previously acted as resistance. This behavior highlights the market’s recognition of prior resistance now acting as support, a bullish confirmation often seen in strong trends. Notably, Tuesday marked the first full trading day entirely above this top channel line, signaling a structural shift in the price action.
Momentum Points Toward Higher Targets
While gold was technically in position to allow a pullback, recent price action underscores that bullish momentum remains dominant. The advance above the top boundary of the channel suggests that higher prices may yet be forthcoming. If momentum is sustained, gold could soon test the next target zone between $3,969 and $4,000.
No Signs of Weakening Yet
Although gold is extended in the short term, there are no clear signs of slowing momentum. A potential bearish divergence with the relative strength index (RSI) failed to confirm and has since been removed, providing bulls with added confidence. The strong breakout above a resistance zone marked by at least five indicators further underscores the depth of demand.
Watching for Pullback and Support Levels
The question now is whether strength can continue without a pause. A pullback to test support around the 10-Day moving average, now at $3,742, would not be surprising and could provide a healthier setup for continuation. The 10-Day line has been a reliable marker of dynamic support since the rally began on August 22, when multiple moving averages were reclaimed simultaneously.
For now, with price action firmly above prior resistance and momentum indicators supporting the advance, gold remains on track to extend its rally, with eyes set on the $3,969 – $4,000 confluence zone.
For a look at all of today’s economic events, check out our economic calendar.