Gold Rebounds Sharply After Early April Dip: Société Générale’s Insights

Gold rebounds after April dip, signaling strong bullish momentum despite earlier concerns of a slowdown. The precious metal staged a remarkable V-shaped recovery following a brief pullback in early April, holding firm above key support near $3135. This bounce back reflects investor confidence, even as overbought signals emerge in the technical charts. According to Société Générale’s FX analysts, gold now eyes higher targets around $3290 and $3345/3370. With momentum intact and no immediate signs of decline, traders are closely watching for the next potential move.

Key Points for Gold Price

• Gold made a strong rebound after the early April dip, finding solid support around $3135.
• Despite some overbought signals, market momentum remains robust.
• Daily MACD signals multi-month highs, though no clear signs of a decline are visible.
• The next support level at $3135/3128 remains crucial for continued upward momentum.

Gold Market Analysis

Market Context:

Gold prices underwent a brief dip in the first week of April, reaching close to the 50-day moving average (DMA). However, this correction quickly turned into a sharp recovery, with prices holding key support around $3135. This recovery has caught the attention of traders, with analysts pointing to a potential continuation of the upward trend in the coming weeks. Despite overbought conditions, the overall momentum in the gold market remains positive, bolstered by the broader economic landscape.

Gold’s price movements are influenced by several factors, including economic data, geopolitical tensions, and shifts in market sentiment. As global uncertainties continue, investors are turning to gold as a safe-haven asset. Gold rebounds after April dip, reflecting the ongoing demand for stability amid fluctuating global markets and investor caution.

Technical Insights:

Looking at the technical aspects, the daily MACD (Moving Average Convergence Divergence) is registering multi-month highs, signaling strong momentum in the gold market. Although these indicators suggest that the market could be stretched, the analysis shows that no immediate signs of a meaningful decline are present.

The March high of $3135/3128 serves as the first key support level for gold. If this level holds, the market could continue its upward trajectory, with the next targets being $3290 and $3345/3370. Traders will be closely monitoring this level to gauge whether the uptrend will continue or if the market will experience a correction.

Expert Opinions:

According to Société Générale’s FX analysts, while the current market conditions show signs of being overbought, the underlying momentum remains intact. The key level to watch is the support around $3135, which could determine the direction of gold prices in the near term. As the market moves forward, analysts suggest that gold could reach the next resistance levels at $3290 and potentially even higher at $3345/3370, if momentum continues to build.

Conclusion:

Gold’s V-shaped recovery after the early April dip has been impressive, with key support at $3135 playing a critical role in maintaining the bullish trend. Despite some overbought signals, momentum is strong, and analysts are forecasting further upside potential, with targets around $3290 and $3345/3370. Traders should continue monitoring the support levels closely to gauge the sustainability of this recovery.

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