Gold Weekly Forecast – XAU/USD Breaches $4,500 as Bulls Defend Multi-Year Trendline

Gold

The gold market has broken above the crucial $4,500 level during the past week, which is a good sign as far as I can tell. It was a previous support level, and now that we are above it, market memory has been broken. After all, last week’s candlestick was a bit of a shooting star right there where you would expect some problems. So being above there is a good sign for me. And now it looks like we are starting to see some momentum re-enter this market.

Long-Term Uptrend and Monetary Policy Backdrop

Ultimately, the market is well above the 50-week EMA and has used the $4,000 level as a bit of a floor. The longer-term uptrend is still very much intact, and you can even draw a trendline that backs up that thought process as well, going back to February of 2024 or so.

Ultimately, this is a market that I do like longer term anyways, and the volume is starting to pick up. But keep in mind that the interest rate situation is still relatively high, and that can cause issues for gold from time to time. We certainly have seen that until the last couple of weeks. But now traders are starting to bet against the Federal Reserve tightening monetary policy. If they do in fact have to abandon that idea, then generally speaking, that tends to help gold.

It’s a bullish-looking chart. I don’t see any reason from a technical analysis standpoint to get bearish at this point. But that doesn’t necessarily mean that it’s a straight shot higher, either. Remember, a lot of markets are moving on the latest press release or announcement coming out of the Middle East, Washington, D.C., and of course the bond markets as well. It’s all kind of a convoluted mess.