Gold market analysis

"Gold Price at $4,500 Becomes a Strong Short-Term Support" 24/12/2025 8:45 Completed 

The market interpreted the sharp rise in gold prices on Tuesday as the escalation of tensions between the United States and Venezuela, as well as the impact of the ongoing Russia-Ukraine conflict, which has not ended in the short term, stimulating the demand for gold as a safe-haven asset. The weak performance of the US dollar also contributed to the increase in gold prices. After reaching the level of $4,497 in the early Asian market yesterday, the spot gold price retreated, briefly fell below $4,470, and then rose again. However, it was blocked at the $4,497 level in the early New York market and then dropped sharply. The main reason is believed to be the acceleration of the growth rate of the US GDP in the third quarter as announced by the US Department of Commerce. 

Data shows that the annualized growth rate of the US GDP in the third quarter reached 4.3%, higher than the 3.8% in the second quarter and exceeding market expectations of 3.3%. Corporate profits also rose sharply by 4.4% in the third quarter. These figures indicate that the US economy remains strong, reducing the possibility of the Federal Reserve cutting interest rates in the future. As a result, gold prices have come under pressure. CME interest rate futures suggest that the market expects an 86.7% chance that the Federal Reserve will keep interest rates unchanged in January. 

Yesterday, the spot gold price finally rebounded after hitting a low of $4,431. By the close of the London market, the price had recovered most of its losses and risen above the 20SMA on the hourly chart (4,478.3). Today is Christmas Eve, and the US financial markets will close early. It should be a time when most investors exit the market, and the gold price is expected to fluctuate within a narrow range. However, it is not impossible that someone might take advantage of the earlier malfunction of CME's cooling system, which prevented it from quoting, to manipulate the gold price up and down. But trading volume will definitely decrease significantly, and the volatility of the gold price may thus increase. 

However, $4,400 is believed to have become a strong support level for gold in the medium term. This morning, gold prices rose further in the early Asian session, breaking through $4,500 and also surpassing the relatively weak resistance at the Gann 315-degree angle of $4,510. This makes it highly likely that $4,500 will become a new strong support level. As mentioned yesterday, the next significant resistance level is at $4,660. Gold prices are expected to fluctuate within a range of $50 to $60 today. Based on the current intraday low of approximately $4,486, gold prices are likely to rise to between $4,536 and $4,546 today. According to observations over a period of time, the 50SMA on the 5-minute chart (currently around $4,496.5) has often provided strong support for gold prices. The unidirectional upward trend of gold prices has already begun. Investors should have a clear strategy in mind! 

Merry Christmas to all! 

The above content is for reference only and does not constitute investment advice.