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- Gold prices saw a retreat from recent highs due to improved market sentiment and tariff exemptions, but Goldman Sachs has increased its gold price forecast for the end of 2025.
- Technical analysis indicates a potential for further price movement, with a focus on the 3250 handle and support at 3195 on the H1 timeframe.
- Period-14 RSI has left overbought territory. Has momentum shifted?
- Gold prices have seen a retreat from the fresh highs printed in the Asian session dropping to a low of 3193 following the US open. Improved market sentiment across the board to start the week on the back of tariff exemptions on tech products from China.
Over the weekend there were also comments from Commerce Secretary Lutnick about how many countries are already ‘negotiating’ with the US. These were seen as positive developments helping overall sentiment and seeing a temporary pause in haven demand.
Goldman Sachs increased its forecast for gold prices by the end of 2025 to $3,700 per ounce, up from $3,300. They expect prices to range between $3,650 and $3,950, driven by higher demand from central banks and increased investments in gold-backed funds due to recession concerns. The bank also noted that if a recession happens, more money could flow into these funds, pushing gold prices to $3,880 per ounce by year-end.
Gold prices should remain supported however with any pullback likely to remain shallow in nature. The macro risks remain in play and until clarity on how much tariffs will be implemented, it looks like a bumpy road ahead. Volatility is likely to remain elevated and price swings are to become normality.
Technical Analysis - Gold
From a technical analysis standpoint, Gold prices have retreated from the fresh all-time highs printed in the Asian session. Looking at the four-hour chart below and the parabolic move from the April 9 lows does leave room for a retracement.
The period-14 RSI has crossed back below the 70 overbought level, which is usually a sign that momentum may be shifting.
Dropping down to a one-hour H1 timeframe, and you can see that gold has formed higher low at 3195 support.
This would suggest a fresh high may be incoming with the 3250 handle now in focus.
However a H1 candle close below the support level at 3195 and a swift drop toward 3167 could come to fruition.
Source: TradingView
