May 31st Gold Sees a Rebound After Hitting a Bottom This Week—Will Next Week Rise or Fall?

This week, gold broadly put in a bottoming-out and rebound recovery, completing the switch between the bullish and bearish positioning. At the start of the week, driven by hawkish remarks from Federal Reserve officials, rate-hike expectations heated up; the US dollar and US Treasury yields strengthened, and gold remained under persistent pressure and moved lower. On Thursday, gold touched around 4365, meeting double strong support; supported by the 200-day moving average and medium- to long-term trendline support, it stopped falling and printed a bottoming candlestick with a long lower shadow. On Friday, a reversal and corrective rebound followed: the close held above 4539, and the weak daily and weekly pattern was thoroughly improved.

This rebound is mainly supported by three favorable factors: US core PCE data staying steady, easing worries about a June rate hike; geopolitical conditions easing, with market sentiment improving; and gold having been oversold earlier, triggering technical buying. As technical indicators gradually return to a neutral state, the market has entered a phase of consolidation and decision-making.

Next week, two key variables will be the focus for gold: first, progress in geopolitical negotiations—changes in the situation will directly affect market risk aversion and inflation expectations, thereby guiding the rhythm of gold’s consolidation; second, remarks by Federal Reserve officials—their hawkish or dovish stance will determine both the strength of gold’s rebound and the depth of the pressure it faces.

Near-term support is 4480-4500, and near-term resistance is 4580-4600; the key medium-term support is 4365-4370, with a strong pressure zone at 4680-4700. Gold this week completed a weak reversal, and next week is likely to continue a broad-range sideways consolidation with a slightly bullish recovery bias; the key is a breakout of the 4480-4600 range. In terms of trading, focus mainly on going long on dips, and use shorting on rallies as a secondary approach, with strict stop-losses to avoid losses from sudden volatility in news.