Gold Price Forecast: RSI Falls Back from Overbought Zone
The price of gold may consolidate over the remainder of the month as the Relative Strength Index (RSI) falls back from overbought territory.
Share this:
Gold Price Outlook: XAU/USD
The price of gold increased for the seventh consecutive week even as a bearish outside day emerged on a daily timeframe, but bullion may consolidate over the remainder of the month as the Relative Strength Index (RSI) falls back from overbought territory.
Gold Price Forecast: RSI Falls Back from Overbought Zone
The price of gold appears to be stuck in a narrow range after registering a fresh record high ($2759), and the RSI may show the bullish momentum abating should the oscillator continue to hold below 70.
Join David Song for the Weekly Fundamental Market Outlook webinar. David provides a market overview and takes questions in real-time. Register Here
Nevertheless, bullion may continue to serve as an alternative to fiat currencies amid the threat of a policy error by major central banks, and the price of gold may reestablish the bullish trend from earlier this year as it still tracks the positive slope in the 50-Day SMA ($2599).
With that said, the range bound price action in gold may end up short lived as it continues to hold above the moving average, but month-end flows may also influence the precious metal amid the uncertainty surrounding the upcoming elections in the US.
XAU/USD Price Chart – Daily
Chart Prepared by David Song, Strategist; XAU/USD on TradingView
- The price of gold consolidates following the failed attempt to push above $2760 (38.2% Fibonacci extension), and bullion may continue to track sideways should it hold above the weekly low ($2709).
- Need a close above $2760 (38.2% Fibonacci extension) to open up $2810 (50% Fibonacci extension), with the next area of interest coming in around $2860 (61.8% Fibonacci extension).
- At the same, failure to hold above the $2700 (23.6% Fibonacci extension) to $2730 (100% Fibonacci extension) region may push the price of gold back towards $2630 (78.6% Fibonacci extension), with the next area of interest coming in around the monthly low ($2603).
Additional Market Outlooks
Monetary vs Fiscal Policy: Implications for FX Markets
Euro Forecast: EUR/USD Recovery Pulls RSI Out of Oversold Zone
USD/CAD Defends Post-BoC Reaction to Eye August High
GBP/USD Vulnerable as Bearish Price Series Persists
--- Written by David Song, Senior Strategist
Follow on X at @DavidJSong
Related tags:
Latest market news
Open an account in minutes
Experience award-winning platforms with fast and secure execution, and enjoy tight spreads from 0.5 pts on FX and 0.3 pts on indices.
Economic calendar
Web Trader platform
Our sophisticated web-based platform is packed with features.
Related articles
Gold, silver outlook: Sandwiched between bullish bonds and AI angst
XAU/USD and XAG/USD may be approaching a bullish turning point as Treasury futures threaten a breakout. The problem? Both metals have recently been trading more like tech stocks than havens.
Gold Rallies Towards a $4k Test – but Can Bulls Break the Trend?
Gold prices melted down last week but so far this week, a different tone has taken over. But can this turn into anything more than a short squeeze?
Gold forecast: XAU/USD stabilised after recent falls – for now
Gold has started the first week of the new month trying to recover some ground after another bruising week. Oil prices have taken a sharp drop and that has allowed risk assets to bounce back, which has clearly helped the precious metal too. However, with sentiment remaining bearish towards the metals, and with $4000 level having been taken out last week, the path of least resistance is to the downside for gold.
This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.
StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.
In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.
StoneX Financial Pte. Ltd. is not under any obligation to update this report.
Trading CFDs carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit www.forex.com/en-sg/terms-and-policies for the complete Risk Disclosure Statement.