Gold's fundamental backdrop is a mixed bag right now. On the positive front, the precious metal continues to draw support as a time-honored safe haven and a reliable shield against cost-of-living pressures. Geopolitical flames in the Middle East, the unrelenting risk of escalation, and the resulting energy supply jitters are all fanning concerns over global inflation and economic fog. In times like these, gold shines—and both retail investors and central banks are taking notice. In fact, the latter are hoarding bullion at a remarkable pace.
On the flip side, the Federal Reserve's (Fed) monetary stance is throwing some serious weight on the scale. The regulator's April 29 decision to hold borrowing costs at 3.75%, paired with a notably tougher tone, has fueled expectations that the era of high real interest rates may stick around longer than anticipated—a headwind for non-yielding gold.
From a technical perspective, however, buyers have plenty to smile about. The precious metal has formed a rock-solid support zone at $4,500, a level that has already rejected the downside multiple times in recent months. Indicators are singing from the same sheet: the Relative Strength Index (RSI) is sitting comfortably in bullish territory and creeping higher, while the MACD has crossed into positive ground, signaling that upside momentum is building and more rallies could be on the way. The next target on the radar? This will probably be $4,750 per ounce.
The ultimate recommendation is to buy gold at the current price, targeting $4,750 within one to two weeks. To cap our downside if the market turns against us, place a Stop Loss order at $4,500, which is 1% below the support floor.
This content is for informational purposes only and is not intended to be investing advice.
