Gold price prediction: Triangle structure signals breakout above $3,440
Gold compresses in triangle pattern below $3,400 as breakout decision approaches
Gold hovered near $3,347 per ounce on Friday, poised for its first weekly loss in three, as stronger-than-expected U.S. economic data dampened near-term hopes for interest rate cuts. The yellow metal is currently compressing within a symmetrical triangle that has been forming since late April, with price caught between dynamic support at $3,310 and overhead resistance at $3,440.
Highlights
- Gold trades at $3,347, consolidating in triangle as Fed signals hold rates steady
- Triangle breakout above $3,440 could trigger rally to $3,550 if momentum confirms
- Retail sales and jobless claims beat forecasts, tempering urgency for rate cuts
While the broader trend remains bullish, gold’s ability to break through this consolidation pattern hinges on both technical and macro catalysts in the coming sessions. The recent bounce from the 50 EMA at $3,310 preserved the higher low structure that has been in place since late 2024. With the 20 EMA also rising at $3,336, gold’s momentum bias remains slightly upward.
XAUUSD price dynamics (Source: TradingView)
However, multiple failed attempts to clear $3,440 have created a weak high that now acts as a significant resistance ceiling. Price action is coiling tighter toward the apex of the triangle, and the relative strength index (RSI) near 52 reflects a neutral but upward-sloping bias. If buyers regain control with a close above $3,440.60, the next leg higher could target the $3,500 to $3,550 zone.
Macro forces weigh on gold sentiment
Gold’s consolidation comes amid strong U.S. retail sales and jobless claims data, which showed resilience in consumer demand and labor markets. The unexpected strength has prompted the Federal Reserve to maintain a cautious stance.
Fed Governor Adriana Kugler said rates would likely stay elevated for some time, though San Francisco Fed President Mary Daly reiterated her expectation of two cuts later in the year. Meanwhile, geopolitical risks continue to provide a floor for gold demand, with President Trump signaling new tariff notifications for over 150 countries, and heightened tensions in both the Middle East and Eastern Europe supporting safe-haven flows.
Forecast points to breakout above $3,440 or retreat toward $3,200
If gold breaks above $3,440 with volume confirmation, a quick rally toward $3,550 could unfold, representing a 6 percent upside from current levels. However, if support at $3,310 fails, the setup would turn bearish, risking a decline toward $3,200 or even $3,015. The direction of this breakout will likely depend on next week’s macroeconomic releases and any new developments on the geopolitical front.
Earlier, gold was trading near $3,330 as the symmetrical triangle continued to form. In our earlier coverage, we highlighted that compression within this structure could trigger a breakout in either direction. With price now pressing against the upper boundary, the bullish scenario appears slightly more probable, assuming external catalysts support risk-off flows.
