Gold is now clawing its way back from yesterday’s brutal sell-off. Yet, this recovery has more to do with technicals than a genuine shift in sentiment. After being battered by hawkish signals from the Federal Reserve (Fed), some traders closed out their shorts and locked in profits, creating a temporary bid that pushed prices higher. This is a textbook reaction to a violent one-way move. However, it says next to nothing about where investor conviction really stands.
Make no mistake—the fundamental picture is still stacked against the precious metal. Half of the central bank’s voting members are keeping an interest rate hike firmly in play for later this year. On top of that, the new Fed Chairman, Kevin Warsh, has made it abundantly clear that price stability is his true North Star. He is avoiding any forward guidance that might calm the market’s nerves. Such an ambiguity leaves gold walking a tightrope, as traders can’t dismiss the prospect of another spike in Treasury yields or a fresh dollar rally—two headwinds that have historically hurt bullion.
That said, regulatory buying is quietly providing support for the market. According to a World Gold Council (WGC) survey, a record number of reserve managers plan to boost their metal holdings over the next 12 months. And here’s the key point: since most of the institutions polled already have bullion in their portfolios, this demand creates a strong buffer that limits how deep corrections can go, even when the Fed is talking tough.
Technically, gold is trading at around $4,318.03, having bounced back from a low of $4,023.84. The Stochastic Oscillator is flashing yellow: its %K line, at 70, has crossed below the %D one, at 75, delivering a bearish crossover just shy of overbought territory—a classic warning that the rally is losing steam. Volume tells the same cautionary tale: the uptick is happening on weak participation, while yesterday’s plunge was backed by heavy selling pressure. Put simply, this is a recipe for more downside once the corrective pop fizzles out.
For those looking to take action, pay attention to the trading plan down below:
Sell gold from $4,320–$4,330. Place Take profit at $4,110. Set Stop loss at $4,400.
This forecast is valid from June 18 till June 25, 2026.
Source:
