Gold Price Prediction: Will $3,312 Support Hold or Trigger a Breakout?
Gold edged up to $3,323 on Wednesday but remains near a three week low as the US dollar gained momentum.
Quick overview
- Gold prices rose to $3,323 but remain close to a three-week low due to a strengthening US dollar.
- Market attention is on the upcoming Jackson Hole Symposium, where signals regarding potential rate cuts may be revealed.
- Geopolitical developments, including discussions between the US and Ukraine, could influence gold's market dynamics.
- Technically, gold is in a wedge pattern, with key resistance at $3,358 and support at $3,312, indicating potential for a breakout.
Gold edged up to $3,323 on Wednesday but remains near a three week low as the US dollar gained momentum. The Dollar Index (DXY) hit a high for the week, making gold more expensive for foreign buyers and capping demand.
Markets are now focused on the Fed’s Jackson Hole Symposium where Fed Chair Jerome Powell speaks on Friday. Traders hope to get a signal on whether rate cuts will resume in September as hinted by the recent Fed minutes. ANZ analysts noted that easing again, plus higher tariffs slowing growth, could be a gold supportive backdrop.
Geopolitical headlines are also in play. Trump ruled out US ground troops in Ukraine but left the door open for air support, which is a positive. Ukrainian President Volodymyr Zelenskiy called talks with Washington a “big step forward” with trilateral talks with Russia now on the table.
Gold Technical Outlook
From a technical standpoint gold is in a wedge, with descending resistance at $3,358 and rising support at $3,312. These patterns often precede big breakouts.
- Candlesticks: Multiple long lower wicks show buyers defending support but weak follow through on bullish engulfing patterns makes me less confident.
- Moving Averages: Price is below the 50-SMA ($3,350) so sellers are in control.
- Momentum Indicators: RSI at 40.5 just above oversold and MACD histogram is fading bearish momentum.
If price breaks above $3,358 then $3,374 and $3,405 are the targets. A close below $3,312 opens up $3,287 and $3,266.
Gold Trade Setup
For beginners this is a classic wedge compression setup. Just be patient and wait for the breakout.
- Long Trade: Enter near $3,315-$3,320 with a stop under $3,310. First target $3,358 then $3,374.
- Short Trade: A break below $3,312 favors downside to $3,287.
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