Gold Price Forecast: Bearish Weekly and Daily Patterns Point Lower
By Bruce Powers
Published: May 2, 2025
As financial analysts observe the recent movements in gold prices, a series of bearish signals has emerged, prompting concerns about potential declines. According to FXEmpire, both weekly and daily patterns have indicated a downward trend, with key support levels likely to be tested in the near future.
Current Market Analysis
On Friday, the price of gold appeared to consolidate following the bearish signals that were triggered on Thursday. A notable daily pattern, characterized by an inside day formation resembling a shooting star candle, suggests the possibility of further declines if gold drops below its low of $3,223 for the day. As of the latest updates, gold continues to trade near this low, raising fears of sustaining a bearish position.
The 20-Day Moving Average (MA), currently positioned at $3,239, is a crucial point of interest. Recent trading has tested this support level, but should today end below this line, it would solidify the bearish sentiment further. A daily close beneath this moving average would signal a continuation of bearish momentum, indicating the potential for a more profound decrease in gold prices.
Selling Pressure Intensifies
Several indicators point to a potential acceleration in selling pressure once gold breaches today’s low. A bearish pennant formation that emerged recently has set a target around $3,027. This significant drop would signify a return into a rising trend channel, a movement that typically raises the risk of further declines, particularly following a failed bullish breakout. Additionally, a failure to maintain support at the 20-Day MA accentuates the bearish outlook for gold.
Weekly Patterns Indicate Bearish Confirmation
Longer-term analysis reinforces the bearish sentiment with a reversal pattern evidenced by a weekly shooting star candlestick. Should gold close today below the preceding week’s low of $2,260, it would affirm this bearish signal. Analysts suggest the potential downside target could align closely with the pennant projection of approximately $3,027. ### Key Support Levels at Risk
The analysis highlights two critical support levels that are currently in jeopardy. The first is a confluence of previous highs at $3,168, aligning with the 61.8% Fibonacci retracement at $3,164. This area coincides with the upper channel line for a broader rising trend. The second notable support lies around the 50-Day MA at $3,086 and the 78.6% retracement level at $3,073, close to the lower trendline of the rising channel. Should these support levels fail to hold, it could pave the way for further declines.
Conclusion
As the markets close today, all eyes are on gold’s ability to withstand key support levels amidst growing bearish patterns. Industry experts are advised to remain vigilant as they monitor gold’s movements closely, particularly looking for confirmations of the bearish signals that have emerged.
For ongoing updates and in-depth analysis of gold and other commodities, check the economic calendar for related events that may impact market directions in the coming days.
About the Author:
Bruce Powers holds over 20 years of experience in financial markets and is an MBA and CMT® charter holder. As a former head of trading strategy at hedge funds, he now shares his insights on futures with retail investors, providing technical and fundamental analysis for strategic financial decision-making.
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