Gold Price Forecast XAU/USD – Boosted by End-of-the-Month Position-Squaring

Gold futures soared on Tuesday on end-of-the-month profit-taking and position-squaring. Gains were likely limited by expectations of higher interest rates from the Federal Reserve. With the main trend down, traders are still in the “sell the rally” mode so we expected this short-covering rally to be met with renewed selling pressure.

On Tuesday, April Comex gold futures settled at $1836.70, up $11.80 or +0.64%. The SPDR Gold Shares ETF (GLD) finished at $169.79, up $0.78 or +0.46%.

Gold slipped to a two-month low on Tuesday while posting its biggest monthly decline since June 2021, pressured by a stronger dollar and prospects of more rate hikes from the U.S. Federal Reserve, according to Reuters.

Daily April Comex Gold Technical Analysis

The main trend is down according to the daily swing chart. However, Tuesday’s dramatic closing price reversal bottom suggests that momentum may be shifting to the upside.

A trade through $1810.80 will negate the closing price reversal bottom and signal a resumption of the downtrend. A move through $1902.30 will change the main trend to up.

The minor trend is also down. A trade through $1856.40 will change the minor trend to up. This will also signal a shift in momentum.

The nearest resistance is a long-term 50% level at $1843.40, followed by another 50% level at $1862.40.

Daily April Comex Gold Technical Forecast

Trader reaction to $1823.80 is likely to determine the direction of the April Comex gold futures contract early Wednesday.

Bullish Scenario

A sustained move over $1823.80 will indicate the presence of buyers. Taking out $1838.60 will confirm the closing price reversal bottom. This could create the upside momentum needed to overcome $1843.40. This is a potential trigger point for an acceleration to the upside with the resistance cluster at $1856.40 – $1862.40 the next likely target area.

Bearish Scenario

A sustained move under $1823.80 will signal the presence of sellers. This could extend the selling into $1810.80. If this fails then look for further selling pressure with $1808.40 and $1797.60 the next likely targets.