Gold Stabilizes Near $4,880 as Safe-Haven Demand Offsets USD Strength
Gold (XAU/USD) recovered some ground on Friday, trading around the $4,880 level. This follows a notable rebound from the Asian session low of $4,655. While a prevailing “risk-off” atmosphere is bolstering precious metals, the persistent strength of the US Dollar continues to act as a ceiling for further price gains.
Key Factors Supporting Gold Prices:
- Dovish Fed Expectations: Renewed pressure on the Federal Reserve to lower interest rates has intensified following a series of disappointing US labor market reports earlier this week.
- Global Equity Sell-off: A three-day decline on Wall Street has triggered widespread risk aversion. This volatility has spilled into the currency markets, driving investors toward the perceived safety of Gold.
- Safe-Haven Positioning: As investors move away from riskier assets like tech stocks, Gold has emerged as a primary beneficiary of the defensive market rotation.
Technical Analysis: A potential Gartley pattern is forming, with a price target of $5,340
Gold is currently trading at $4,876 on the 4-hour chart, remaining capped by the 100-period SMA. However, momentum is shifting; the MACD histogram is contracting as the MACD line nears a bullish cross over the signal line, while the RSI has recovered to neutral territory.
While the immediate trend is still bearish, Thursday’s higher low offers a glimmer of hope for bulls. The improving indicators suggest XAU/USD may be entering the CD leg of a Gartley pattern, targeting the 78.6% Fibonacci resistance at $5,340. Key hurdles remain at the 100-period SMA ($4,920) and the weekly high ($5,100). On the downside, support is firm at $4,655 and $4,400.
