Gold extended its upward trajectory on Thursday, edging toward the $3,670 per ounce zone amid a softer US Dollar and a pullback in Treasury yields across the curve. Investors continue to digest the Federal Reserve’s 25 bps rate cut and Chair Jerome Powell’s hawkish guidance, which tempered the initial dovish reaction but left demand for the safe-haven asset firmly intact.
From a technical perspective, the RSI remains in overbought territory, hinting at the risk of profit-taking. Still, Wednesday’s rebound from the $3,645 support region, which aligns with a bullish flag breakout zone, signals that buyers are defending key levels. A sustained drop below that area could expose the $3,610–$3,600 support cluster, while holding above keeps the door open for fresh highs.
On the upside, immediate resistance emerges at $3,678–$3,680, with a clear break paving the way toward the $3,700–$3,707 record zone. A firm move beyond these levels would reaffirm bullish momentum and likely extend the multi-week uptrend.
Fundamentals Driving Gold
The Fed’s latest policy shift supports the bullish case for gold. While Powell stressed a meeting-by-meeting approach, the central bank’s projection of two additional cuts this year underlines a softer policy path at a time when US labour data is showing cracks. This environment favours non-yielding assets like gold.
Geopolitical uncertainty also adds fuel to the rally. Escalation in the Russia-Ukraine conflict and renewed tensions in the Middle East, including Israel’s intensified offensive in Gaza, continue to amplify safe-haven flows. Calls from European leaders for stricter measures against both Russia and Israel further underscore the fragile global landscape.
Looking Ahead
Market focus now shifts to the US Jobless Claims and Philly Fed Manufacturing Index, which could provide near-term volatility. Central bank updates, particularly from the Bank of England on Thursday and the Bank of Japan on Friday, will also be closely watched for their impact on cross-asset sentiment and gold demand.
