Continuing previous weeks trend, lower levels of volatility may be considered as a primary scenario.
XAU/USD short-term forecast
Gold on the 1-hour chart has just broken out of a long sideways range between 4900.00 and 5050.00, surging sharply to about 5180.00. The latest candles show some red, suggesting short-term profit-taking after the strong rally. The recent high near 5180.00 is the immediate resistance, while the previous resistance at 5090.00 should now act as support, with 5000.00 as a major floor if that breaks.
The short-term 30-period SMA is sharply rising, showing strong momentum, but the price is far above it, indicating a possible short-term overextension.
XAU/USD daily charts review
Gold recently moved from a sharp parabolic rally into a period of consolidation with a slight bullish bias. The price is holding just above a long-term ascending trend line that has acted as strong support, showing a coiling effect that suggests a potential breakout is coming. Since peaking near 5600.00, gold has been flagging, which is normal after a big run-up as the market digests gains. Currently, the price sits around 5141.145, just above the trend line, indicating that as long as it stays above roughly 5000–5100, the upward path remains favored.Further inflationary pressures and elevated levels of uncertainty may provide bullish bias of the precious metals price in the near term.
Daily Candle Chart
Traders going long
Gold sentiment is currently strongly bullish, with approximately 73.63% of traders holding long positions. This high long-to-short ratio suggests a significant retail expectation that gold prices will continue to climb, especially as it maintains a position above the key 5100.00 psychological level.