The rise of gold above the $3,000 mark is likely to be short-lived, as the momentum indicators for this precious metal suggest a potential pullback soon. While the key goal remains a return to the resistance level of $3,500, gold has currently reached its most overbought level according to the relative strength index (RSI) on the monthly timeframe since February 2008.

The RSI for gold has risen to 84.63, significantly above the overbought threshold of 70. This is the highest level since early 2008 — a few months before the metal experienced a sharp decline amid the global financial crisis.

It is worth noting that over the past two decades, similar jumps in monthly RSI have often signaled medium- and long-term peaks in the gold market.

The recent rise in gold was driven by investors moving capital into protective assets amid widespread market volatility caused by uncertainty surrounding trade tariffs. This climate has heightened concerns among market participants about a potential upcoming recession.

Currently, gold is already showing weakness — at the time of writing this article, the price has fallen by 1% to $3,283, although it has maintained a 25% increase since the beginning of the year. The current price still exceeds both the 50-day simple moving average (SMA) at $3,127 and the 200-day SMA at $2,828, indicating the preservation of the upward trend.

Also read: Gold could reach $5,000 in 2025

Gold is forming a bearish pattern

Meanwhile, experienced trader Peter Brandt suggested that gold may face further losses. In a post on X from April 29, he noted that the metal is forming a coiling bearish pattern within a descending triangle, creating lower peaks near the horizontal support level around $3,300.

The expert believes that this is a continuation triangle — a bearish pattern that often signals further declines.

Brandt also noted similarities with the weekly gold chart from 2013 — at that time, a prolonged downward phase began before the crash. If the analogy holds true, gold could break the current support near $3,300 and fall to $3,200 or lower.

The alignment of moving averages, with the short-term line below the long-term line, further reinforces the bearish scenario.

If the bulls cannot seize the initiative and push the price above $3,350, the downward trend will continue. Prolonged negative dynamics and bearish sentiments may complicate the achievement of a record level of $4,000 by 2025.

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