Gold Price Alert: Gold bounced up after reaching the target of a Double Top pattern, at $4,005 on Tuesday, but upside attempts have been halted way below previous support, at $4,185, which leaves the immediate bearish trend intact and the $4,000 support area at a short distance.
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The announcement that US President Trump will meet its Chinese counterpart Xi Jinping in South Korea next week and the more conciliatory tone of Trump’s latest comments towards the Asian country have boosted hopes of a trade deal, which has improved market sentiment, sending precious metals tumbling.
Technical Analysis: Gold’s bearish correction has finally arrived
Gold Price Update: Correction Continues After Big Rally
What goes up must come down — and gold is no different. After a strong 35% rally in the last two months, the precious metal is now seeing a much-needed price correction. A double top near $4,380 and Tuesday’s bearish candle on the daily chart confirm that selling pressure has returned.
During Wednesday’s early European session, gold was rejected near $4,160, showing that bearish momentum remains strong. The 4-hour RSI is still not in oversold territory, while the US Dollar Index is gaining strength — adding more pressure on gold. This suggests that a retest of the $4,000 support level could happen soon.
If the price breaks below $4,000, the next support zone is around $3,945, where gold previously found support on October 7, 9, and 10. Below that, traders are watching $3,845 as the next key level. On the upside, resistance lies near $4,160 and $4,185, before gold can again attempt to move toward its all-time high of $4,380.