Gold pushed above the $4,600 level to a more-than-three-month high near $4,670 on August 24, driven by dollar weakness, Treasury buyback expectations, and safe-haven demand. Bulls are eyeing $4,770 and then $4,820 if the metal clears resistance near $4,680–$4,720, though overbought momentum readings point to a possible near-term pullback.
Gold extended its advance on August 24, with spot prices reaching a more than three-month high near $4,670 as the metal moved back above the $4,600 psychological level. Renewed dollar weakness has powered the latest leg higher, and the weekly, daily, and H4 charts all show improving structure, with major moving averages positively aligned for further gains.
But the rally isn't without warning signs. The daily and four-hour relative strength index sit around 70 to 72, a level that signals strong momentum yet also an increasingly stretched short-term condition. As a result, a sustained break above $4,680–$4,720 would confirm the next bullish leg and open the way toward $4,770 and then $4,820, while a slide below $4,575–$4,545 would risk a deeper pullback toward $4,450.
Fed policy keeps traders on edge
The Federal Reserve held its target range at 3.50%–3.75% at its July meeting, though several policymakers dissented in favor of a 25-basis-point hike. Markets are now pricing roughly a 36% probability of a September rate hike, leaving traders highly sensitive to incoming data. Investors are awaiting the upcoming PCE inflation data and Fed Chair Kevin Warsh's speech at Jackson Hole for further signals on the rate path.
Treasury buybacks and central-bank demand add support
US Treasury buyback expectations, with officials reportedly willing to go beyond $4 billion, have contributed to dollar weakness and improved gold's relative appeal. Reuters reported that gold's more than 5% gain during the previous week was underpinned by the buyback plan and the resulting pressure on the dollar. Still, gold remains sensitive to real yields, and a renewed sharp rise in Treasury yields could temporarily cap the advance.
Official-sector demand remains a significant structural pillar for gold, providing a longer-term cushion beneath significant corrections. Reuters has also highlighted persistent central-bank demand and renewed investor interest as important supports for gold's role as an inflation, currency, and geopolitical hedge. Continued geopolitical uncertainty, including tensions surrounding Iran and broader trade-related risks, is likewise maintaining demand for defensive assets.
Source: Investing.com
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