On Wednesday, Spot Gold prices jumped to an all-time high of almost $4,890. That’s a notable milestone, adding to the string of all-time highs for the valuable metal. Gold has skyrocketed historically, trading now at about $4,820. This repair could attract new buyers as it gets closer to the $4,800 psychological support level.
The past few weeks increase in Gold prices has had its significance. Yet despite the commodity’s weak underlying fundamentals, price performance has been supported by this bullish sentiment, including its position well above all major moving averages. The 20-period Simple Moving Average (SMA) is now above the 100- and 200-period SMAs. This unambiguous positioning has been indicative of a powerful bullish trend. Policywise, this positioning is important as it highlights the potential for even more positive movement in the short term.
Gold is right now in a normal corrective decline of around $70 from its recent high. Overall, analysts believe this substantial drop could potentially find support around the $4,800 mark. This price point serves as a psychological anchor. Simultaneously, it coincides with a number of technical indicators that would suggest the presence of buying interest. The 20-day SMA serves as a first line of dynamic support at $4,724.08 and the 100 SMA presents a second floor at $4,530.83.
The bullish bias for Gold is still strong in the daily chart. The RSI is at 69, meaning that Gold is close to overbought levels but not there yet, so it continues to maintain its momentum. The explanation for the persistent Gold prices strength should focus on the positive fundamentals Gold prices, bullish market sentiment and supportive macroeconomic data.
Looking ahead, the next U.S. economic calendar first-tier data occurs on Thursday, which could determine Gold’s near-term path higher or lower. On deck are numbers for October and November, the later of which includes the Personal Consumption Expenditures (PCE) Price Index. It is this index that the Federal Reserve prefers as its primary measure of inflation. Depending on its results, it could impact investor sentiment during the process and potentially gold prices over the long term.