Gold climbed to a three-month high near $4,644 on Monday after breaking a six-month downtrend, putting the $4,700 resistance area back in focus.
Key Points:
- Gold closed above its 20-week moving average for the first time since April.
- The metal has recovered about 17% from its July low, with resistance now concentrated between $4,700 and $4,800.
- Daily RSI has climbed above 70, while the weekly reading near 60 suggests the broader move is less stretched.
Gold Breakout
Gold bottomed at $3,942.92 during the correction, close to the 0.5 Fibonacci retracement of the advance that began in 2024. The low also fell inside the $3,900 to $4,000 support zone, while weekly RSI held near 40 instead of reaching oversold territory below 30.
The week ending Aug. 21 marked a technical shift. Gold closed above its 20-week moving average and the $4,333.52 Fibonacci level, clearing a $4,300 to $4,400 zone that had limited advances from November 2025 through May.
The rally gained momentum after U.S. federal debt moved above $40 trillion, Treasury Secretary Scott Bessent increased debt buyback operations and the dollar index slipped below 100. Central banks also bought 289 tonnes of gold in the second quarter, up 62% from a year earlier.
Also Read: Tom Lee's Bitmine Buys $81M Of Ether In The Week The Rally Took Off
Goldman Sachs Target
Daily RSI reached 71.7, its first reading above 70 since January, which raises the risk of a short-term pause even as weekly momentum remains less extended. Resistance begins near $4,700, followed by $4,750 to $4,800, while a measured move from the $3,900 base points toward $4,900.
Goldman Sachs maintains a $4,900 year-end target after cutting its forecast from $5,400 in June, leaving its projection aligned with the technical measured move.
The bank also identified $4,400 as a downside case if the Federal Reserve raises rates, a scenario that would pressure the current breakout.
Support now starts around $4,500, while a weekly close below $4,300 would weaken the breakout and restore pressure on the newly reclaimed zone. A close on Aug. 28 will coincide with Federal Reserve Chair Kevin Warsh delivering his first Jackson Hole address, adding another policy event for gold traders to watch.
Gold remains about 17% below its Jan. 28 record of $5,598. That peak began a correction lasting roughly 26 weeks, with prices falling about 29% before the July bottom and breaking the descending trendline in early August.
Read Next: Strategy Raises $2B From MSTR With Bitcoin Buying On Hold
