Gold Rally May Face Headwinds, US$5,000 Levels Remain Critical
Gold futures on the COMEX surged above the US$4,800 level, supported by strong buying momentum, although technical indicators suggest further upside may face stiff resistance, according to RHB Investment Bank Berhad.
The precious metal settled at US$4,813.10, after opening at US$4,698.40. Prices briefly dipped to an intraday low of US$4,690 before climbing to a high of US$4,821, forming a long bullish candlestick that signals strong investor demand.
Momentum strengthens but caution remains
RHB noted that the relative strength index (RSI) has crossed above the 50% threshold, indicating that bullish momentum is gaining traction in the near term.
Gold may attempt to test the 20-day simple moving average (SMA) line, although both the 20-day and 50-day SMA levels are currently acting as resistance zones, limiting further gains.
Key resistance at US$5,000
Despite the recent rebound, the research house maintains a cautious outlook, highlighting US$5,000 as a critical resistance level.
“In a broader bearish setup, upward price movements tend to be capped by resistance levels,” RHB said, adding that a sustained break above US$5,000 would be needed to shift the overall market bias to a more positive stance.
Negative bias maintained
Pending a decisive breakout, RHB retains a negative trading bias on gold, suggesting that the current rally may face headwinds unless stronger bullish confirmation emerges.
