Gold Outlook: Record Highs on Ice as Bearish Signals Build

Bearish signals building across daily and weekly timeframes
Sellers parked above $3367; support emerging near $3285
Break below $3246 may open path towards $3050 area

Summary

Near-term directional risks for gold may be skewing lower, suggesting it could be some time before the record high of $3500 per ounce is revisited. With optimism around U.S. trade deals likely to persist even without concrete agreements, prior tailwinds from safe haven flows may now act as headwinds.

Bearish Signals Build

The gold chart below is divided into two panes, showing the daily timeframe on the left and weekly on the right. Both highlight growing downside risks.

Source: TradingView

The bearish reversal after setting record highs last Tuesday signalled a potential unwind was underway, with further selling following on Wednesday. Later in the week, sellers repeatedly stepped in above $3367, making that a key near-term level for those considering short setups.

On the dailies, RSI (14) is trending lower and MACD is close to crossing the signal line, suggesting bullish momentum is waning. Should these trends persist, the signal could shift from neutral to outright bearish, strengthening the case for further downside.

Screening longer timeframes also helps assess medium-term risks. While the week is still young, the current three-candle pattern on the weekly chart resembles an evening star—a formation often seen around market tops. Last week’s tombstone doji adds to the warning signs of a potential bearish reversal.

For now, bids continue to emerge on moves below $3285, including today. If those were to give way, minor support levels at $3246 and $3167.80 would come into focus before a tougher test for bears awaits near $3050, where horizontal support, uptrend support, and the 50-day simple moving average converge.

Should gold reverse back above $3367 and hold there, the bearish bias would be invalidated, opening the path for another run towards the record highs.

-- Written by David Scutt

Follow David on Twitter @scutty

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