FX.co ★ Retired-Mogambo | XAU/USD, GOLD

Following the loss of support at an internal trendline and the 200-day moving average two weeks prior, gold caused the breakdown of a long-term rising trendline on Wednesday. The next lower target zone, which was defined by the 127.2% Fibonacci extension of the previous rise near $3,927, was then somewhat below but still close to the new trend low of $3,959 that was established during that session. Gold experienced a narrow range day in the lower half of Wednesday's trading range on Thursday, following the decline with consolidation. The median of a declining channel that served as a support zone during the previous low at $4,023 two weeks ago is close to the 127.2% extension. Additionally, there was a previous swing low of $3,886 in October. When taken as a whole, these signs create a more expansive support zone between around $4,023 and $3,886. As a result, a drop below $3,959 still appears likely. A break below Thursday's low of $3,966 would be a little earlier indication of deterioration. However, traders are expected to retreat and test those areas as resistance over several timeframes and at various scales, given that major support has been breached. For instance, Thursday's high of $4,044 tested the previous trend support from two weeks ago. Naturally, the most important resistance test would take place close to the rising trendline. After a test of resistance levels is over, a bearish continuation is expected since the break of the trendline was verified by a daily close below it, confirming the continuation of the larger decline. For now, the trendline might be represented by Wednesday's lower daily high of $4,115. Overall, the breakdown of long-term support supports the more general change in momentum, where gold has moved from a corrective phase into a growing bearish continuation structure due to the loss of important technical levels. Following a steep decline to the solid support level of $3,950, the price of gold (XAU) increased on Thursday. Following the announcement of the core PCE price index data, this comeback took place. The core PCE price index rose 3.4% year over year in May 2026, as seen in the chart below. Since October, this level has been the highest. The US dollar index corrected on Thursday in spite of this information, which caused the price of gold to rise little. Due to a minor increase in the core PCE price index in May, the Federal Reserve might continue to exercise caution. The demand for a non-yielding asset will decrease as a result of rising interest rates, which is bad news for gold. As a result, this gold rally will probably be limited, and short-term price pressure may persist. According to the spot gold daily chart, the price reached $3,959 on Wednesday and began to rise following the release of core PCE price index data. However, the price is still under pressure, and the rebound is still quite small. The creation of the wedge pattern indicates how crucial this support at $3,950 is. The price is still moving between $4,000 and $5,000 in this wedge pattern. The next move in the gold market must be defined by a break of these levels. Spot gold's immediate resistance level is still $4,350. Further upside towards the $5,000 range will be indicated by a break above this level. The significance of the $3,950 support level is further demonstrated by the spot gold 4-hour chart. The present support zone is where the price is consolidating. The RSI indicator shows a recovery from present levels and is likewise oversold. However, a break below $3,950 will increase short-term pressure. To relieve the bearish pressure on the spot gold market, a rebound over $4,350 is necessary.