Gold Price Forecast: XAU/USD Suffers Historic Reversal After Record Run – Is the High In?

Gold Technical Forecast: XAU/USD Weekly Trade Levels

Gold surged nearly 30% from the monthly low to fresh record highs before reversing sharply, with Friday marking the largest single-day loss on record
The reversal followed a rejection from a major confluence resistance zone, raising the risk that a near-term high is now in place as price tests lower support levels.
Resistance 5000, 5520-5615 (key), 6000– Support 4780, 4604 (key), 4319

Gold’s record-breaking rally has ended with a dramatic reversal, as XAU/USD posted the largest single-day loss on record and the widest weekly trading range in history. The move followed a sharp rejection from a major confluence resistance zone, suggesting the advance may have reached a near-term exhaustion point after an extended run. While the broader bullish structure remains intact for now, the magnitude and speed of the reversal place emphasis on how price behaves at upcoming support levels. The response here will be critical in determining whether gold stabilizes within the larger uptrend or transitions into a more meaningful corrective phase. Battle lines drawn on the XAU/USD weekly technical chart.

Gold Price Chart – XAU/USD Weekly

Chart Prepared by Michael Boutros, Sr. Technical Strategist; XAU/USD on TradingView

Technical Outlook: In my last Gold Technical Forecast we noted that XAU/USD was, “attempting to mount confluent uptrend resistance this week and a close above 4603 is needed to keep the bulls in control. From a trading standpoint, losses should be limited to the yearly open IF price is heading higher on this stretch with a close above slope resistance needed to fuel the next major leg of the advance.” Gold broke higher the following week with price surging more than 29.8% off the monthly low to fresh record highs.

The rally extended into confluent uptrend resistance on the heels of the Fed decision this week at 5520-5615- a region defined by the 2.618% extension of the December 2024 advance and the 1.618% extension of the August rally. Gold has now plunged more than 14.2% off the high with Friday marking the largest single-day loss on record and the largest one-week range in history. Is a high in place? The risk from a technical standpoint would suggest a near-term high is indeed in place.

Initial weekly support rests with the 61.8% retracement of the monthly range at 4780 and is backed medium-term bullish invalidation at the 1.618% extension near 4604. Note that the lower parallel of the 2025 pitchfork and the median-line of the broader 2024 advance converge on this this zone over the next few weeks. A break / weekly close below this threshold would be needed to suggest a more significant high is in place and a larger trend reversal is underway. Subsequent support rests with the objective yearly open at 4319 and the October high-week close (HWC) at 4112- both levels of interest of possible downside exhaustion / price inflection IF reached.

Initial resistance is eyed at 5000 with a breach / close above the medina-line needed to fuel another run at the 5220-5615 resistance zone. Strength beyond this threshold is needed to fuel the next major leg of the advance towards the upper parallels which converge on the 6000 psychological barrier in early March.

Bottom line: Gold’s record-breaking rally has exhausted with a spectacular reversal into the close of the week halting the immediate bull-run. From a trading standpoint, losses would need to be limited to 4604 for the 2025 uptrend to remain viable with a weekly back above 5K needed to fuel another run at the highs.

Keep in mind we are heading into the close of the month with key US ADP and Non-Farm Payrolls on tap next week. Say nimble into the monthly cross and watch the weekly closes here for guidance. I’ll publish an updated Gold Short-term Outlook once we get further clarity on the near-term XAU/USD technical trade levels.

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Economic Calendar - latest economic developments and upcoming event risk.

--- Written by Michael Boutros, Senior Technical Strategist

Follow Michael on X @MBForex

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