Gold Rallies as Key Technical Level Falls
Gold prices surged on Monday as the precious metal broke through a key technical level. The price of gold extended its rebound, surpassing the 38.2% Fibonacci retracement level at $4,692 and setting its sights on the next major target: the 50% retracement at $4,900.
The rally builds on last week's momentum, where gold cleared multiple resistance hurdles without a significant pullback. The ease with which those levels gave way suggests that buyers remain confident in stepping in at progressively higher prices.
A stronger dollar did little to deter gold's advance, but it did weigh on silver, highlighting a notable divergence within the precious metals complex. Gold's ability to rise against a strengthening greenback indicates that its current move is being driven more by safe-haven demand and unease over the U.S. fiscal and monetary outlook.
Citi raised its zero-to-three-month gold price target to $4,800 an ounce while keeping its six-to-twelve-month target unchanged at $5,000. JPMorgan offered a similarly constructive view, citing an opaque Middle East backdrop, weekend tariff headlines, and the upcoming core PCE inflation data as key catalysts for the rally.
JPMorgan sees gold trading in a near-term range of roughly $4,500 to $5,000. A hot inflation reading would likely trigger a retest of the 200-day moving average to the downside, while cooler-than-expected data could push gold closer to $5,000 within a week.