Gold is breaking down and may now have formed a double top pattern. The precious metal fell below the neckline of the double top at 3,230, which implies that gold prices have further to fall. A projection of that double top suggests that gold could fall to around $3,000.
There is more at play here, suggesting that something deeper could be unfolding for gold. It had appeared to form a descending triangle, but instead of breaking lower, gold broke higher and climbed back to the previous highs around $3,400, allowing it to create the double top pattern. However, we now see that the base of the descending triangle became the neckline for the double top, and gold continues to hit and bounce off the downtrend that began on April 21. For now, gold is supported by that trend line and the Bollinger Band, presenting an opportunity for a potential bounce.
In fact, if gold is still in an uptrend, this would be the most likely point for it to bounce. The concern, however, is that if gold has indeed formed a double top and falls to $3,000, it would break below an uptrend that began at the start of 2025—part of a larger bump-and-run pattern. This would create a more bearish medium-term outlook for gold. Typically, when a bump-and-run pattern breaks the initial trend line, it tends to resolve by falling to a lower, longer-term trend line, which in this case could be around $2,900.
Right now, gold is at a critical juncture—if it doesn’t bounce, the likelihood of a larger decline increases significantly.
Written by Michael J. Kramer, founder of Mott Capital Management.
Disclaimer: CMC Markets is an execution-only service provider. The material (whether or not it states any opinions) is for general information purposes only and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed.
No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction, or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although we are not specifically prevented from dealing before providing this material, we do not seek to take advantage of the material prior to its dissemination.
There is more at play here, suggesting that something deeper could be unfolding for gold. It had appeared to form a descending triangle, but instead of breaking lower, gold broke higher and climbed back to the previous highs around $3,400, allowing it to create the double top pattern. However, we now see that the base of the descending triangle became the neckline for the double top, and gold continues to hit and bounce off the downtrend that began on April 21. For now, gold is supported by that trend line and the Bollinger Band, presenting an opportunity for a potential bounce.
In fact, if gold is still in an uptrend, this would be the most likely point for it to bounce. The concern, however, is that if gold has indeed formed a double top and falls to $3,000, it would break below an uptrend that began at the start of 2025—part of a larger bump-and-run pattern. This would create a more bearish medium-term outlook for gold. Typically, when a bump-and-run pattern breaks the initial trend line, it tends to resolve by falling to a lower, longer-term trend line, which in this case could be around $2,900.
Right now, gold is at a critical juncture—if it doesn’t bounce, the likelihood of a larger decline increases significantly.
Written by Michael J. Kramer, founder of Mott Capital Management.
Disclaimer: CMC Markets is an execution-only service provider. The material (whether or not it states any opinions) is for general information purposes only and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed.
No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction, or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although we are not specifically prevented from dealing before providing this material, we do not seek to take advantage of the material prior to its dissemination.
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The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.