Gold Short-term Outlook: XAU/USD Bulls Defend Make-or-Break Support

Gold Technical Outlook: XAU/USD Short-term Trade Levels

• Gold prices plunge into 2025 trend support- rebounds more than 4% off multi-week low
• XAU/USD risk for price inflection ahead- key range breakout pending
• Resistance 3265/88, 3355/81 (key), 3431- Support 3132/37 (key), 3018, 2953/56

Gold prices rebounded off key support this week after plunging more than 10.8% off the yearly high. It’s decision time for the bulls at the 2025 uptrend- battle lines drawn on the short-term gold technical charts.

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 the XAU/USD reversal was, “challenging a break of the May opening-range with multi-month trend support now in view at 3132/37- a region defined by the 38.2% retracement of the November advance and the 100% extension of the April decline. Note that the lower parallel converges on this threshold over the next few days further highlights the technical significance of this zone (area of interest for possible downside exhaustion / price inflection IF reached).”

Gold briefly registered an intraday low at 3121 this week before rebounding 4.2% with daily momentum easing off six-month lows. Price is poised to mark the largest weekly decline of the year ahead of the close on Friday with weekly momentum breaking back from overbought territory for the first time since February. The pullback has now completed two-equal legs off the highs and IF a bull-market correction is complete, these lows would need to hold.   

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 trading within the confines of an embedded descending pitchfork with the lower parallel further highlighting this week’s rebound off key support at 3132/37. Note that losses below this threshold would threaten another bout of accelerated losses with a break / close below needed to suggest a more significant high is in place / invalidate the November uptrend. Subsequent support objectives seen at the lower parallel (currently near ~3080), backed by 3018 and 1.618% extension / February high / April low at 2953/56.

Initial resistance now eyed at the median-line (currently ~3240) backed closely by the 38.2% retracement of the April decline / May open at 3265/88. Bearish invalidation remains unchanged at the record high-day close (HDC) around 3381- strength beyond this level would shift the focus back towards the record high close at 3431.

Bottom line: Gold has responded to key technical support and the first major test of the November uptrend. Risk for exhaustion / price inflection off this mark in the days ahead. From a trading standpoint, the immediate focus is on a breakout of the 3132-3288 range for guidance with the bears vulnerable while above this key support pivot. Review my latest Gold Weekly Technical Forecast for a closer look at the longer-term XAU/USD trade levels.

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--- Written by Michael Boutros, Sr Technical Strategist with FOREX.com

Follow Michael on X @MBForex