Spot gold extended gains to $4,670 on Monday as a weaker U.S. dollar and heightened geopolitical uncertainty reinforced safe-haven demand, according to technical analysis by Investing.com.
The yellow metal has retraced above the $4,600 psychological level, with the latest advance marking a breakout from the $4,400–$4,500 resistance cluster. The daily chart shows a bullish structure, with price trading above the 100-, 200-, and 250-day moving averages and pushing toward the upper bound of the recent range. However, the daily Relative Strength Index (RSI) is hovering near 72, signaling strong momentum but also an elevated risk of a near-term consolidation or profit-taking phase.
Analysts at Investing.com note that overbought conditions on smaller time frames do not necessarily imply a bearish reversal in a strong trend, as RSI can remain elevated for extended periods. The immediate focus is on the $4,680–$4,720 resistance zone, a breakout through which would expose the next upside target at $4,770, followed by $4,820. Support is seen in the $4,600–$4,580 area, with deeper retracements potentially targeting $4,550 or $4,460 if the advance stalls.
Fundamental drivers cited for the rally include renewed dollar weakness, which has been a key catalyst for gold’s more than 5% weekly gain. The Federal Reserve’s July policy meeting left the federal funds rate unchanged at 3.50%–3.75%, though several officials favored a 25-basis-point hike. Markets are now pricing a roughly 36% probability of a September rate hike, with investors awaiting upcoming inflation data and Fed Chair Kevin Warsh’s remarks at the Jackson Hole symposium.
Treasury yields and fiscal dynamics are also influencing gold’s trajectory. A recent U.S. Treasury buyback plan exceeding $4 billion has contributed to dollar pressure, though a sharp rise in real yields could temper the rally. Central-bank demand remains a structural pillar, with persistent official-sector purchases providing a longer-term floor beneath corrections. Geopolitical risks, including tensions related to Iran and broader trade disputes, continue to underpin defensive demand for the metal.
The analysis suggests that the medium- and long-term outlook remains constructive, provided gold maintains stability above the $4,575–$4,550 support region. A decisive breakout above $4,680–$4,720 would reinforce the bullish case, while a sustained move below $4,575 could signal a deeper retracement toward $4,450.
