FX.co ★ The End | XAU/USD, GOLD

Gold shows resilience as it focuses on key levels of resilience Gold prices rebounded on Friday to hit a high of $2,632, slightly above Thursday's high of $2,626. A strong close, placed in the upper third of the daily price range, suggests momentum that could challenge the resistance around the 20-day moving average (MA), currently at $2,644. This level coincides with a downtrend line and creates a significant pivot point when the two technical indicators converge. Resilience testing at key levels Earlier in the week, from Monday to Wednesday, gold encountered resistance near these lines, reinforcing their importance as potential turning points. If the bearish momentum seen on Wednesday continues, gold may face renewed selling pressure around the 20-day MA, causing a potential reversal lower. Should prices decline, the first major target lies at the 78.6% Fibonacci retracement level of $2,576, just below this week's low. If the bearish trend continues, gold could test the recent swing low of $2,537, which is in line with the lower boundary of the downtrend channel. A decisive move below $2,537 could open the door to further downside, targeting the $2,475-$2,473 zone where several key indicators are converging. Bearish signals and key support levels The $2,475 target is in line with the completion of the descending ABCD pattern, suggesting symmetry between the two descending legs. Additionally, this level coincides with the 61.8% Fibonacci retracement and previously acted as both support and resistance, making it a critical price zone to watch. A bull run could change sentiment While the bearish outlook remains intact, a break above $2,664 – the weekly high – could signal a reversal. Such a move would place gold back above the 20-day MA and trendline, potentially shifting sentiment to a bullish stance. Additionally, a weekly close above the 20-week MA that gold is currently poised to reach would reinforce longer-term support and boost confidence in a recovery. Currently, traders should keep a close eye on price action for clearer directional signals.