Gold Price Rally Pushes RSI Back into Overbought Territory

Gold Price Outlook: XAU/USD

The price of gold climbs to a fresh record high ($3045) as it extends the advance from the start of the week, with the rise in bullion pushing the Relative Strength Index (RSI) back into overbought territory.

Gold Price Rally Pushes RSI Back into Overbought Territory

The price of gold may continue to register fresh record highs as it carves a series of higher highs and lows, and the move above 70 in the RSI is likely to be accompanied by a further advance in the precious metal like the price action from earlier this year.

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It seems as though the ongoing transition in US trade policy is boosting the appeal of gold as it clouds the outlook for the global economy, and the threat of a trade war may keep bullion afloat as it offers an alternative to fiat-currencies.

With that said, the price of gold may continue to track the positive slope in the 50-Day SMA ($2853) as it still holds above the moving average, but the RSI may show the bullish momentum abating if it struggles to hold above 70.

XAU/USD Price Chart – Daily

Chart Prepared by David Song, Senior Strategist; XAU/USD on TradingView

The price of gold extends the advance from the start of the week to carve a series of higher highs and lows, and the rally in the precious metal may persist as long as the Relative Strength Index (RSI) holds above 70.
A break/close above the $3050 (100% Fibonacci extension) to $3070 (50% Fibonacci extension) zone opens up $3120 (61.8% Fibonacci extension), with the next area of interest coming in around $3160 (161.8% Fibonacci extension) to $3190 (78.6% Fibonacci extension).
At the same time, lack of momentum to break/close above the $3050 (100% Fibonacci extension) to $3070 (50% Fibonacci extension) zone may push the price of gold back towards the $3000 (161.8% Fibonacci extension) $3020 (38.2% Fibonacci extension) region, with the next area of interest coming in around $2940 (78.6% Fibonacci extension) to $2960 (23.6% Fibonacci extension).

Additional Market Outlooks

British Pound Forecast: GBP/USD Vulnerable to Dovish Bank of England (BoE)

Canadian Dollar Forecast: USD/CAD Coils Ahead of Reciprocal Trump Tariffs

EUR/USD Rebounds Ahead of Weekly Low to Keep RSI in Overbought Zone

USD/JPY Rebound in Focus with BoJ Expected to Hold Interest Rate

--- Written by David Song, Senior Strategist

Follow on X at @DavidJSong

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