Gold Price Forecast: Potential Correction Looms as Weekly Reversal Pattern Signals Trend Fatigue

Gold’s historic rally to fresh all-time highs above $3,500 is now showing signs of losing momentum, as key technical patterns hint at an upcoming correction. The precious metal is trading cautiously, with major support levels at $3,228 and $3,164 under the spotlight.

Gold Eyes Reversal After Record Highs – Is the Bull Run Overextended?

This week’s price action has formed a bearish weekly shooting star candlestick, suggesting growing downside pressure after gold touched a new intraday high of $3,509.90. However, this reversal pattern will only confirm if the price breaks below the weekly low of $3,260.

Interestingly, a similar one-day shooting star pattern emerged on Wednesday, coinciding with the new record high. Thursday’s session saw gold trading within Wednesday’s range, establishing a low at $3,287 and a high at $3,368.

Technical Outlook: Bullish Momentum at Risk

While gold remains in a broader uptrend, the steep acceleration in its recent rally has raised caution. Trendlines and moving averages — particularly the expanding gap between the 20-Day, 50-Day, and 200-Day MAs — reflect a strong, but potentially overheated, bullish move.

If the price dips below $3,287, it could trigger a deeper pullback toward the key support area between $3,246 and $3,228, which includes both a 50% Fibonacci retracement and a previously broken trendline now acting as support.

Next Major Support Levels to Watch

Should selling pressure intensify, gold may slide further to the 61.8% Fibonacci retracement around $3,164 — a crucial zone where bulls may attempt to regroup.

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Key Takeaways for Traders:

• Weekly and daily candlestick patterns suggest trend exhaustion.
• Breakdown below $3,260 may trigger a bearish reversal.
• Watch for support near $3,228 and $3,164 if momentum fades.
• Trend remains bullish unless key levels are breached.

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