Gold Price Short-term Outlook: XAU/USD Plunges 17% – Key Support Break Sparks Risk
Gold collapsed on the heels of the Fed rate decision with XAU/USD now testing a pivotal support. A reaction here could determine whether losses accelerate.
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Gold Technical Outlook: XAU/USD Short-term Trade Levels
- Gold collapsed nearly 17% from the monthly high, breaking through multiple support levels on the way down.
- The decline has carried XAU/USD into a pivotal support zone near the 2025 high, where the next reaction becomes pivotal.
- A sustained move below this level would expose deeper downside targets, while stabilization here could slow the pace of losses.
- Resistance 4660/80, 4791-4815 (key), 4996- Support 4533/40 (key), 4319, 4224/51
Gold’s sharp decline has gathered pace, driving prices lower after a decisive break beneath key technical support. The move marks a clear shift in near-term price action, with the selloff extending into a major support zone that could determine the next phase of the trend. Momentum has weakened notably on both daily and weekly charts, underscoring the pressure on the market as it approaches this inflection point. Whether buyers step in at this level or selling continues to accelerate will likely dictate the path for gold in the sessions ahead. Battle lines drawn on the XAU/USD short-term technical charts.
Review my latest Weekly Strategy Webinar for an in-depth breakdown of this gold technical setup and more. Join live on Monday’s at 8:30am EST.
Gold Price Chart – XAU/USD Daily
Chart Prepared by Michael Boutros, Sr. Technical Strategist; XAU/USD on TradingView
Technical Outlook: In my last Gold Short-term Outlook we noted that XAU/USD, “is threatening to mark an outside-weekly reversal off resistance at multi-week highs. The risk remains for further losses near-term within the February uptrend. From a trading standpoint, losses should be limited to 4791 IF price is heading higher on this stretch..” Gold prices have now plunged more than 16.9% off the monthly high with the XAU/USD breaking through support today. RSI has dropped to the lowest levels since November of 2024 on both the daily & weekly timeframes and keeps the momentum profile in favor of the bulls for now.
The decline takes price into the next pivotal support today at 4533/40- a region defined by the 61.8% retracement of the October lows and the 2025 high-day close. Losses below this threshold would threaten another bout of accelerated losses for gold and the immediate focus is on a reaction off this zone today.
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 below near-term downtrend support at the February low-day close and the 61.8% extension of the decline off the record high at 4660/80. Look for initial resistance there now and a close below this level is needed to keep the immediate decline viable in the days ahead. Subsequent resistance is eyed at the 61.8% retracement of the February advance and the 100% extension of the monthly decline at 4791-4815 with bearish invalidation now lowered to the March opening-range low (ORL) at 4996.
A break / close below 4533 exposes subsequent support objectives at the yearly open at 4319 backed by the 100% extension and the October reversal close at 4224/51. Both levels represent area of interest for possible downside exhaustion / price inflection IF reached.
Bottom line: Gold has broken key technical levels on this decline, and the immediate focus is on today’s close with respect to 4660/80 for near-term guidance. From a trading standpoint, rallies would need to be limited to 4815 IF price is heading lower on this stretch with a close below 4533 needed to fuel the next major leg of the decline.
The economic calendar is light next week, and the focus will remain on developments out of the Middle East as the Iranian war continues to escalate. Keep an eye on the headlines and watch the weekly closes here 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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Active Short-term Technical Charts
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--- Written by Michael Boutros, Senior Technical Strategist
Follow Michael on X @MBForex
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