Is the rally over? Signs of reversal on gold

We are now seeing a potential double top pattern forming on gold (XAU/USD), with price currently testing the 0.5 Fibonacci retracement level around $3,230. At the time of writing, gold is trading slightly below this level, and although this could look like a break of support, experienced traders know that these horizontal levels should not be treated as exact lines. Instead, they function more like zones with a buffer area, allowing room for minor overshoots or fakeouts before a move is confirmed.

This area around $3,230 is now acting as a key pivot, and what happens here may decide whether gold is entering a deeper pullback or simply forming a range. If price manages to stabilise and hold above this zone, we may see the structure evolve into a rectangle or sideways trading range. However, if price continues to push lower, the next obvious support lies in the area between the 0.618 and 0.702 Fibonacci retracement levels. That zone, located between $3,130 and $3,150, aligns well with a previously untested breakout level and could be the next destination if selling pressure increases.

We are clearly at a decisive moment. A confirmed breakdown below this current level would reinforce the double top structure and suggest that a short-term or even high time frame reversal is developing. On the flip side, a strong bounce here would reintroduce the idea of consolidation, and we’d be looking at this entire zone as part of a new trading range.

For gold traders, this is a crucial area to monitor closely, especially given the broader market shifts we’re seeing across major assets. Price action over the next few sessions could set the tone for where gold is headed next in the macro trend.

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