Selling pressure drives Gold lower on persistent downward trend

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Gold drops 1.32% today to $4,060

Highlights

Institutional investors and central banks increased physical gold purchases, supporting overall gold demand during rising global uncertainty.
Direct accumulation by major buyers restricts available supply and increases gold's price sensitivity to future events.
Gold trades below key moving averages with mixed momentum signals, and is expected to remain in the $3,937 to $4,182 range over the next 2 to 3 days.

Central bank buying lifts institutional flows despite persistent selling

Institutional flows into gold increased as central banks continued purchases, a trend confirmed by Investing.com. This direct buying by major institutions and monetary authorities enhanced physical demand for gold and reflected heightened hedging activity amid global uncertainty. Such accumulation can restrict available supply and amplify price sensitivity to future events, though price action has remained under broader selling pressure.

Mixed momentum signals as sellers dominate amid technical divergences

Gold currently trades below both the 20-period (at $4,091) and 200-period ($4,350) moving averages, but remains above the 50-period level at $4,019, suggesting sellers are in control on short- and long-term timeframes, while the mid-term shows some underlying support. Immediate resistance is marked by the Ichimoku Kijun at $4,088. Momentum readings are split: MACD issues a Strong Buy signal, while ADX points to a Sell, and the Awesome Oscillator remains neutral. The RSI is neutral, while both the Stoch RSI and CCI are in the oversold zone, indicating potential short-term selling exhaustion but with no firm confirmation of a rebound. Bull/Bear Power stands positive at 11.38, hinting at an intraday edge for buyers.

Volatility narrows outlook as support and resistance levels converge

Looking ahead to the next 2-3 trading days, gold’s expected price band is $3,937 to $4,182, reflecting a typical volatility band relative to current levels. The probability of a downward move stands at 57%, while an upside breakout has a 43% likelihood according to model estimates. A bullish scenario arises if XAU breaks above resistance at $4,088, whereas breach and confirmation below $3,937 would reinforce a bearish extension.

Viktoras Karapetjanc, expert at Traders Union, sees institutional demand for gold as a strong underlying force, especially with central banks increasing their purchases. He believes robust hedging activity and ongoing uncertainty are supporting the mid-term trend despite short- and long-term technical weakness. The analyst expects volatility to stay elevated, with buyers gaining an edge should resistance at $4,088 be overcome. "I remain constructive on gold in the near term, as institutional flows continue to offset broader selling pressure and global risks fuel demand for safe havens."

Earlier, analysts noted that gold was consolidating as central bank accumulation and shifting macro drivers kept price direction uncertain. The current analysis adds that while institutional demand persists, technical signals remain mixed, making the confirmation of a move above $4,088 or below $3,937 crucial for determining the next decisive trend.

Source of Data: XAU Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

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