Gold () is trading on the four-hour timeframe near a critical support zone around $3,982, following a sharp selloff that pushed prices to their lowest levels in several months. Current price action suggests that bearish momentum is beginning to fade, with momentum indicators moving into oversold territory while the metal continues to hold above a key technical demand zone. This combination increases the likelihood of a corrective rebound over the coming sessions. However, the short-term outlook remains cautiously bearish as long as continues to trade below the descending moving average and nearby technical resistance levels.
In my view, gold is currently trading near a critical support zone between $3,977 and $3,963, an area that could attract renewed buying interest if prices manage to hold above it. The completion of an AB=CD harmonic pattern around these levels further strengthens the case for a corrective rebound in the sessions ahead. A sustained move above $4,038 would provide the first technical indication that bullish momentum is returning, while a decisive breakout above $4,093 would confirm the end of the corrective phase and open the way for a move toward $4,207 over the medium term.
On the other hand, if selling pressure intensifies and gold closes decisively below $3,963, losses could extend toward $3,850, a strategic support level that represents the last line of defense for the medium-term bullish trend. Consequently, the near-term direction of gold prices will largely depend on buyers’ ability to defend the current support zone, alongside developments in the U.S. dollar, oil prices, Treasury yields, and any shifts in Federal Reserve monetary policy expectations.
Support: $3,977 | $3,963 | $3,850
Resistance: $4,038 | $4,093 | $4,207
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