Introduction
Gold futures (GC) rebounded off the R1 pivot at 4012.9 as buyers stepped back in to defend the support following Tuesdays 6% selloff, the biggest single-day drop in years. The retracement came after gold reached a fresh all-time high near $4,219, before seeing profit-taking amid easing geopolitical fears and a brief rebound in the U.S. dollar.
Technical Overview
Gold is holding steady above the R1 pivot at 4,012.9 after pulling back from overbought levels. This dip is the first real test of bullish momentum since the breakout in early September. Monday’s strong bounce near $4,000 shows buyers are stepping in, making that level key short-term support.
Gold is still trading above its 50-day moving average (3,756.7), which means the medium-term uptrend is still in place. The next hurdle is breaking through the $4,180–$4,200 resistance zone. If that happens, prices could climb toward the R3 level at 4,406. But if gold falls below $4,000, it could head down to the next support at 3,619.7.
Even with recent swings, the overall trend remains bullish, backed by rising moving averages and higher lows.
Key Technical Levels
| Type | Level | Description |
|---|---|---|
| Resistance 1 | 4,180–4,220 | All-time high zone / short-term ceiling |
| Support 1 | 4,000–4,050 | Key support; recent low and R1 pivot |
| Support 2 | 3,756 | 50-day MA / trendline support |
| Major Support | 3,620 | S1 pivot; next key downside level |
Probability Table (Next 2–3 Weeks)
| Scenario | Estimated Probability | Notes |
|---|---|---|
| Rebound and retest of 4,200–4,220 ATH | 60% | Strong rebound off support; momentum recovering. |
| Sideways consolidation between 4,000–4,150 | 25% | Possible as market digests gains. |
| Deeper correction below 4,000 | 15% | Would signal temporary loss of bullish control. |
Fundamentals
Gold pulled back last week as tensions in the Middle East briefly eased and the U.S. dollar (DXY) bounced. Still, demand for gold remains strong due to global uncertainty, ongoing central bank buying, and concerns about inflation.
Stable U.S. Treasury yields are also helping gold by lowering the cost of holding it, since gold doesn’t pay interest. Markets are now waiting for new inflation data and Fed comments—any sign of easier policy or renewed geopolitical risk could push gold higher again.
Bottom line: despite the sharp drop, the long-term outlook for gold remains strong.
Summary
Gold futures remain technically strong despite a sharp pullback from record highs. The $4,000 support zone has held firm, suggesting buyers are still in control. A move back above $4,180 would confirm renewed bullish momentum and potentially set up a retest of the $4,400 region in the coming sessions.
Unless price decisively breaks below $4,000, the path of least resistance remains upward, with short-term consolidation likely acting as a base for the next leg higher.
This analysis is for educational and informational purposes only and does not constitute trading advice or a recommendation to buy or sell any futures contracts. Futures trading involves significant risk and may not be suitable for all investors. Always conduct your own research and consult with a licensed financial professional before making trading decisions.