Gold is trading around $4,146–$4,148 after bouncing from the $3,900–$4,000 support zone, but it still sits below major resistance. FXStreet analyst Sachin Kotecha rates it a watchlist idea rather than a confirmed trade, with the $4,240–$4,360 zone the decision point.
Gold has bounced but has not broken out, which leaves it as a watchlist idea rather than a confirmed trade, according to FXStreet analyst Sachin Kotecha. The metal trades around $4,146–$4,148, still below major daily and weekly resistance, so the recovery has not yet become a confirmed bullish reversal.
The setup is not strong enough to justify chasing a long, yet not weak enough to sell aggressively. Kotecha frames gold as a conditional trade and assigns it a trade quality score of 58/100.
The $4,240–$4,360 decision zone
Price has bounced from the $3,900–$4,000 support zone, showing demand lower down, but the next high-quality opportunity depends on how it reacts around $4,240–$4,360. A break and hold above that zone would strengthen the bullish case; a rejection followed by a loss of $4,070 would make the bearish case more attractive.
The weekly chart remains the concern. Gold has corrected sharply from a previous peak around $5,300–$5,500 and still trades below the key weekly Ichimoku levels, with weekly resistance sitting near $4,358, then $4,433 and $4,564.
Momentum improving, not leading
Daily momentum has firmed, with RSI recovering to around 45 and moving above its RSI-based moving average. The weekly RSI is less convincing, holding around 40 and still below its moving average near 48.
Kotecha ties gold’s direction to the US dollar, Treasury yields, real yields, inflation expectations and Federal Reserve policy. A weaker dollar and falling real yields would support the metal, especially if markets price a more dovish Fed; sticky inflation, rising yields and a stronger dollar could stall the bounce.
What comes next
Kotecha names US inflation as the biggest catalyst, alongside Fed communication, the dollar and yields. On the chart, he says gold needs to either break above $4,240–$4,360 or reject that zone and lose $4,070. Until one happens, the setup remains unfinished, and patience looks like the highest-quality decision.
Source: FXStreet
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