Gold consolidates as $4,500 support holds

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Gold drops 0.72% to $4,562 today

Highlights

Physical gold demand surged 42% last quarter to 474 tonnes as investors sought safety amid market volatility and inflation risks.
Despite robust bar and coin purchases, gold prices experienced continued selling pressure due to broader market sentiment.
Technicals signal persistent short-term weakness, but with price near key longer-term support, gold is expected to consolidate in the $4,500–$4,750 range next week.

Physical gold demand soars as inflation and oil volatility weigh on price

Bar and coin gold purchases rose 42% to 474 tonnes in the last quarter, the second-highest on record, as reported by Khaleej Times. This surge reflects heightened consumer demand in response to market volatility driven by oil price increases and inflation concerns. Despite strong physical demand, price action has remained under broader selling pressure.

Bearish momentum strengthens as gold tests key supports amid volatility

Gold is trading below the MA-20 at $4,717.37 and the MA-50 at $4,699.26, and just under the MA-200 at $4,564.83. The Ichimoku Kijun at $2,442.00 marks clear support well below the current level. Momentum remains weak with a MACD reading of -49.20 and an ADX of 38.71, supporting bearish dynamics. The RSI is at 42.35 and CCI at -9.02, both hovering near neutral, while Stoch RSI and Bull/Bear Power (BBP at -33.44) indicate oversold conditions and persistent seller dominance. The Awesome Oscillator also confirms a negative trend, with gold nearly at the intraday low after a modest opening gap down amid strong volatility.

Rangebound outlook persists as sellers challenge lower support levels

In the short term, gold is expected to remain within a typical volatility band of $4,500–$4,750, centering near $4,600 in line with recent weekly ranges. The base case scenario anticipates sideways consolidation as sellers test support levels. A sustained move above $4,750 could trigger additional buying momentum, while a break below $4,500 may open the path to further declines and new short-term lows.

Anton Kharitonov, expert at Traders Union, notes that strong consumer demand for physical gold contrasts with persistent technical weakness. He highlights that despite record bar and coin purchases, price action remains bearish and momentum indicators signal low confidence. The bias is for sideways or lower movement as sellers continue to test support near $4,500. "Until gold can reclaim levels above $4,750 and reverse its technical momentum, the risks remain skewed to the downside," Kharitonov says.

Previously it was reported that accelerating central bank gold sales were contributing to a broadly bearish tone for the metal despite mixed technical signals. The current backdrop of robust physical demand alongside persistent technical weakness deepens the contrast between market forces, making the $4,500 support zone especially critical to monitor for a potential shift in momentum.

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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