GOLD’S HIGHEST HIGH – BUT IS THE PARTY OVER?

Gold’s Record Smash: Is a Crash Coming?

Gold has just shattered records, launching past the jaw-dropping $3,000 mark last week! This meteoric rise was fueled by an insatiable appetite for safe-haven investments and relentless buying from central banks. But don’t pop the champagne just yet! After a slight dip at the week’s end, gold is bouncing back—yet questions loom: Can this blazing momentum last, or are we staring at an impending pullback?

Warning! Signs of Overheating!

Hold onto your hats, because gold’s explosive rally might be running on fumes! Technical indicators are screaming caution, and a correction could be looming large. What’s putting the brakes on this golden ride? If geopolitical tensions cool off—thanks to promises from political bigwigs to resolve the mess in Ukraine and Gaza—the rush for gold could dwindle.

And get this: higher gold prices might awaken miners from their slumber, cranking up supply, while central banks may lose their taste for more purchases. Plus, keep your eyes peeled on US stock markets—if they stage a rally, we could see investors ditching gold for more daring assets.

While the bulls may be leading the charge, it’s crucial to remember that even the boldest rallies need a breather every now and then!

This Week’s Hot Data: Core PCE Price Index

Gold’s fate hangs in the balance as economic data from the US looms! Today’s S&P flash PMIs might not shake things up, but Friday brings the Fed’s holy grail of inflation indicators—the Core PCE Price Index. Mixed signals have flooded recent reports, with softer inflation numbers from CPI and RPI battling it out against a University of Michigan survey indicating rising inflation fears. Jerome Powell has been doing his best to calm the chaos, but uncertainty still reigns.

Market watchers are gearing up for a potential +0.3% uptick in core PCE—which could send shockwaves through the dollar and gold prices!

Bulls Still Roaring – For Now!

Gold’s trend is still firmly planted in bullish territory, and dip-buying could be the name of the game! But don’t let that blind you—warning lights are flashing! The daily RSI is showing signs of negative divergence, meaning while gold prices are hitting new highs, the momentum isn’t keeping pace as it should! Last week, gold hit resistance around the $3,032-$3,043 range, and while it touched a new peak of $3,057, it closed below that key Fibonacci zone! Is this a signal that short-term momentum is fizzling out?

Must-Watch Support Levels:

• $3,000: This crucial psychological barrier held strong during Friday’s test; a breach could unleash a wave of panic selling!
• $2,930-$2,956: This former breakout zone, aligned with the 21-day moving average, is another critical support line to keep an eye on!

Overbought Alert! Long-Term Caution Ahead!

Warning, warning! Gold’s long-term charts are lighting up with overbought signals! The monthly RSI has been riding high above 70 since April 2024, recently hitting a staggering 80—historically, a precursor to pullbacks. We’ve seen this before during major peaks in 2011 and the pandemic era. The weekly RSI is nearing 75, amplifying the caution!

While this doesn’t cement the idea of an imminent downturn, the stage is set for some much-needed consolidation or a healthy correction before gold can soar higher again!

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Grab your gold and your wits—this market is a rollercoaster ride!