Gold prices experienced a slight downturn early on Thursday, retreating from recent highs near $2,315. Analysts attribute this pullback to widespread risk aversion in the market, with investors exercising caution ahead of the release of the preliminary US first-quarter Gross Domestic Product (GDP) data later in the day.
Market sentiment remained subdued in Asia, with investors reacting negatively to Meta’s disappointing revenue guidance despite the company exceeding first-quarter earnings expectations. Meta shares saw a sharp decline of 16% in post-market trading following its announcement of lower-than-expected sales projections for the second quarter.
Chart analysis indicates that gold prices settled below the crucial 21-day Simple Moving Average (SMA) on Wednesday, signaling increased bearish sentiment among traders. However, the 14-day Relative Strength Index (RSI) suggests that the market may still be favorable for buyers, holding steady above the midline near 56.00.
Should selling pressure persist, gold prices could potentially test the $2,300 support level, with the previous session’s low of $2,291 serving as a potential target. Further downside could see buyers defend the early April low near $2,265.
Conversely, a sustained recovery above the 21-day SMA, now acting as resistance at $2,324, could reignite bullish momentum, potentially leading to a test of the psychological level at $2,350. Additional upside may see buyers targeting static resistance levels near $2,360-$2,365.
As market participants await the release of US GDP data, the direction of gold prices in the short term remains uncertain, with investors closely monitoring economic indicators for further guidance.