Technical analysis by AdamIdris2 about Symbol PAXG on 5/17/2025

As of mid-May 2025, gold prices have experienced a notable decline, retreating from April's record highs above $3,500 per ounce to approximately $3,180. This downturn is attributed to easing geopolitical tensions, particularly the U.S.-China trade truce, and a strengthening U.S. dollar, which have reduced the demand for gold as a safe-haven asset.Technical Analysis: Short-Term OutlookKey Support Levels: Analysts identify the $3,155 level as a critical support point. A breach below this could signal further declines towards the $3,000–$3,050 range.Resistance Zones: Resistance is observed around $3,275–$3,287.85. A decisive move above this range may indicate a potential reversal or continuation of the uptrend.Indicators: The Relative Strength Index (RSI) remains in bearish territory, suggesting continued downward pressure. However, if gold maintains its position above the ascending channel's lower boundary, a rebound towards $3,450 is plausible.Fundamental Analysis: Medium-Term OutlookCentral Bank Demand: The People's Bank of China has increased its gold reserves for the sixth consecutive month, reflecting sustained institutional interest.Investor Sentiment: Despite recent corrections, gold remains up 21% year-to-date, indicating robust investor confidence. However, nearly 50% of fund managers surveyed by Bank of America believe gold is overvalued, which could lead to cautious trading behavior.Economic Indicators: U.S. producer prices fell by 0.5%, and retail sales stagnated, with inflation dipping to 2.3%. These factors may influence Federal Reserve policy decisions, potentially affecting gold prices.Forecast SummaryNext Week: Gold prices may test the $3,155 support level. A breach could lead to further declines towards $3,000. Conversely, holding above this level might prompt a rebound towards $3,275.Next Month: Analysts anticipate a consolidation phase, with gold trading between $3,000 and $3,300. Factors such as central bank purchases and economic data releases will play pivotal roles in determining the direction.