- Gold is projected to reach a new high of over $3,720 in a cautious market amid ongoing geopolitical tensions.
- The next targets could be $3,730 and $3,760.
- Technical analysis indicates buying conditions, although daily RSI hints at potential bearish divergence.
Gold surged from the $3,630 range on Friday and continued to gain on Monday, driven by a cautious market and hopes for further easing. Currently, precious metals are trading at around $3,720, with $3,730 and $3,760 as possible future targets.
The general environment remains quite supportive. With rising tensions involving Russia and its European partners, European markets are opening with moderately negative sentiments. Meanwhile, Israel’s ongoing occupation of Gaza is generating increased resistance among Western countries.
Technical Analysis: Gold is resilient and optimistic, yet seems to be overextending
On another note, technical indicators are sending out warnings. Daily charts reveal that prices have surged over 12% in just a month, and the RSI is starting to indicate signs of bearish divergence. The MACD suggests an upcoming bearish cross.
Immediate resistance stands at $3,760, based on last week’s Fibonacci retracement, with $3,730 coming before the 161.8% retracement level. Beyond that, a round figure of $3,800 also emerges as a potential target.
If prices drop, support might hold up around $3,615-3,630, relative to a past all-time high of $3,707. Looking lower, $3,580 is a key focus point, marked by highs on September 3 and lows on September 8.
