Gold Prices Exhibit Volatility Amid Technical Patterns

Gold prices showed significant volatility during the Asian market session on Thursday, with spot gold briefly touching an intraday high of $2,339.04 per ounce before falling back to around $2,332 per ounce, with the intraday gain shrinking to approximately $4.

According to FXStreet analyst Christian Borjon Valencia, the daily chart of gold indicates the presence of a head-and-shoulders pattern. The Relative Strength Index (RSI) is hovering around the neutral line at 50, suggesting neither buyers nor sellers are in full control of the market. However, the head-and-shoulders pattern suggests a potential short-term decline in gold prices.

Valencia suggests that if gold prices fall below $2,300 per ounce, the next level of support would be the May 3 low of $2,277 per ounce, followed by the March 21 high of $2,222 per ounce. If these levels are breached, gold could slide further, with the head-and-shoulders target being around $2,170 to $2,160 per ounce.

Conversely, Valencia notes that if gold prices continue to rise and break above $2,350 per ounce, the key resistance will be at the June 7 cycle high of $2,387 per ounce. Beyond that, gold could challenge the $2,400 per ounce mark.