On August 17, market sentiment was influenced by softer U.S. retail data, which fueled expectations of imminent interest rate cuts, putting pressure on the U.S. dollar and providing a tailwind for gold prices. Global central banks continue their gold purchases, offering medium- to long-term support, while fluctuating geopolitical tensions in the Middle East introduce sporadic safe-haven demand.
The upcoming release of the Federal Reserve's meeting minutes has brought a cautious tone to the market, with news-driven factors primarily causing minor disruptions. The current price action is largely dictated by technical patterns.
On the weekly chart, gold prices rallied before closing with a long lower shadow, confirming a bullish candle. Medium-term moving averages are sloping upward, maintaining a robust long-term bullish structure. However, the Relative Strength Index (RSI) has retreated from overbought territory, and the MACD histogram is shrinking. The metal faces selling pressure near previous highs, suggesting the market is entering a phase of high-level consolidation and repair rather than a trend reversal. The 5-week moving average serves as a key medium-term support level.
The daily chart shows a small bullish candle formed after a bounce from intraday lows on Friday. The price has reclaimed the 10-day moving average but failed to hold above the 5-day moving average, indicating a volatile consolidation pattern at elevated levels. The MACD has formed a bearish crossover, but the green bars are contracting, and the Bollinger Bands are narrowing. This suggests the pace of the one-sided rally is slowing, with increasing divergence between bulls and bears, placing the market in a directional decision window. Focus is on the performance of moving averages.
On the 4-hour timeframe, the Bollinger Bands are contracting and flattening. The price is oscillating in a range between the 20-period and 60-period moving averages, with alternating bullish and bearish candlestick patterns. Indicators are repeatedly flipping between bullish and bearish crossovers, without a clear directional signal.
The hourly chart clearly shows a range-bound market, where prices frequently pierce support and resistance levels, making chasing breakouts a high-risk strategy. It is prudent to wait for a confirmed breakout of a key level before entering a trade.
In summary, the long-term bullish foundation remains intact, but the short-term momentum is insufficient to drive a breakout, leading to wide-range consolidation. Key resistance lies at 4435-4450, while initial support is found at 4385-4365. A suggested trading plan includes: initiating a long position on a pullback and stabilization in the 4396-4385 area, with a stop-loss below 4380, targeting 4430-4440. Alternatively, a short position can be taken on a bounce and failure at 4435-4440, with a stop-loss above 4450, targeting a pullback to 4392-4380.
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