This week, the Middle East crisis, coupled with the Federal Reserve's hawkish stance, dealt a double blow to gold, causing prices to plummet by 10%, marking the worst drop since February 2020. Gold prices briefly plunged to a near seven-week low of $4502, approaching a key psychological level, before experiencing a slight rebound.



This raises a crucial question: Has the sharp sell-off that began in March, starting from the historical high of 5597, already bottomed out?

From a technical perspective, the momentum indicator on the 4-hour chart has turned upward from the oversold zone, exacerbating market speculation that the recent decline may have been overextended. Gold prices rebounding above the previously broken support trendline is another positive sign; however, the market still needs to be patient, as gold prices have not yet broken through the 23.6% Fibonacci retracement level of the March decline at 4718, as well as the intraday resistance level of 4735.

If gold prices rebound further, the next resistance level will be around 4850, where the 20-day simple moving average and the 38.2% Fibonacci retracement level intersect. Above this, bulls may attempt to break through the psychological level of 5000 and the resistance trendline near 5016, unless they encounter resistance at 4960 (the 50% Fibonacci retracement level).


(4-hour chart of spot gold source: EasyForex)

On the downside, if the price breaks below 4659, selling pressure may return, and the 4500 level will once again become the focus. If the decline continues, support will be provided around 4400; a deeper pullback may find support around 4325, a level last seen in December 2025.

In summary, the gold price sell-off has temporarily stabilized near the key support area; however, the bulls need to decisively break through the 4718-4735 range to strengthen upward momentum and regain market confidence.