Gold Technical Outlook: XAU/USD Short-term Trade Levels
- Gold rallies more than 6.7% off the late-October lows, marks largest single-day advance since May
- XAU/USD price now testing pivotal resistance- risk for near-term inflection
- Catalyst risk: a flurry of Fed speakers is due in coming days; traders will listen for rate-path color into year-end.
- Resistance 4125, 4187/93 (key), 4252- Support 4049, 3987-4002 (key), 3930
Gold prices surged more than 3.7% into the start of the week, with XAU/USD mounting its largest single-day advance since May 6- that instance marked the monthly high in gold. Price is stalling into pivotal resistance today, and the focus is on possible price inflection off this level. It’s decision time for gold traders, and losses would need to be limited for bulls maintain control. With the economic docket still light amid the ongoing government shutdown, attention turns to a wave of Fed commentary expected in the days ahead for clues on the policy outlook into year-end. Battle lines drawn on the XAU/USD short-term technical charts.
Gold Price Chart – XAU/USD Daily
Chart Prepared by Michael Boutros, Sr. Technical Strategist; XAU/USD on TradingView
Technical Outlook: In last month’s Gold Short-term Outlook we noted that a rebound into the close of October, “leaves the potential for further gains in the near-term. From a trading standpoint, rallies would need to be limited to 4125 IF price is heading for a deeper correction on this stretch.” XAU/USD has rallied more than 6.7% off the late-October lows with the advance exhausting today at the 10/21 reversal close at 4125. That decline marked the largest single-day range in the history and the focus is on today’s close with respect to this key threshold for guidance.
Gold Price Chart – XAU/USD 240min
Chart Prepared by Michael Boutros, Sr. Technical Strategist; XAU/USD on TradingView
Notes: A closer look at gold price action shows XAU/USD breaking above the median-line yesterday with today’s pullback testing this slope as support- look for possible inflection here over the next 24 hours. A slip back below the median-line exposes the 38.2% retracement of the late-October recovery at 4049. Note that basic channel support extending off last week’s low converges on this level over the next few days. Subsequent support rests with the 61.8% retracement and the November open at 3987-4002, with near-term bullish invalidation set to the monthly range low at 3930. Losses below this threshold would suggest a more significant correction is underway towards 3900 and the 50% retracement of the August rally at 3846.
Key near-term resistance is eyed at the 1.618% extension of the late-October rally and the 61.8% extension of the decline off the record high at 4187/93. Ultimately, a topside breach / close above the 10/17 reversal close at 4252 is needed to mark resumption of the broader uptrend with subsequent resistance objectives eyed at the 2025 high-day close (HDC) and the record high at 4356/82, and the 1.618% extension of the yearly advance at 4553. Note that this level converges on uptrend resistance towards the end of the month- look for a larger reaction there IF reached.
Bottom line: Gold has rallied back above the median of the yearly uptrend, with XAU/USD price action threatening to print a daily doji just below resistance. The setup highlights risk for price inflection off this zone in the days ahead. From a trading standpoint, losses would need to be contained to 4049 IF gold is heading higher on this stretch, with a close above 4193 needed to fuel the next major leg of the advance.
Keep in mind that the economic docket remains light this week amid the ongoing government shutdown. Although the Senate voted to re-open yesterday, it will take time for key data releases to catch up after such a prolonged pause. In the meantime, a flurry of Fed speakers are scheduled over the next few days, and traders will look for insight into how policymakers view the rate path into year-end after weeks of limited data. Stay nimble until the monthly range clears and watch the weekly closes for guidance. Review my latest Gold Weekly Technical Forecast for a closer look at the longer-term XAU/USD trade levels.
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--- Written by Michael Boutros, Sr Technical Strategist
Follow Michael on X @MBForex
