Gold’s Double Top Points to $3,906 After a $224 Drop

By Grace Kim

ThinkMarkets’ chart analysis put gold spot down $224 in under three days, with the metal trading near $3,936 after breaking below the $4,027.51 neckline of a double top. The pattern’s measured target is $3,906.48, still below the quoted market.

What has the double top confirmed?

According to ThinkMarkets, gold formed two peaks five days apart. The first reached $4,146.95 on 5 November; the second reached $4,148.54 on Tuesday. The trough between them, $4,027.51 on 6 November, set the neckline. Gold broke below it Tuesday evening, briefly reclaimed it during Wednesday’s retest, then fell below again Wednesday night.

ThinkMarkets measured the formation at $121, from the second peak to the neckline, and projected that distance lower for a $3,906.48 target. The breakout candle closed at $4,018.65 at 22:00 Tuesday.

On Wednesday, five candles closed back above the neckline before the rebound stalled at $4,067.04, right at a descending trendline. The 22:00 candle then broke below again and closed at $3,993.21.

No candle has closed above the neckline since, ThinkMarkets said, and the latest lower low extended the decline. RSI reached 61.84 at the second peak, versus 68.50 at the first, indicating weaker momentum at a similar price. A trendline drawn through the 10 November highs has capped four rallies. It slopes down roughly $60 a day and sat near $3,997 on the current candle, below the neckline.

ThinkMarkets still counts the double top as intact below $4,027.51.

How far has the November rally unwound?

Last week’s ThinkMarkets analysis mapped the November rally from $3,870.09 to $4,146.95 through Fibonacci retracement levels. The decline has crossed those levels in sequence.

The 38.2% retracement at $4,041.19 and the 50% retracement at $4,008.52 gave way during the neckline break. The 61.8% retracement at $3,975.85 and the $3,975.64 to $3,989.08 band broke during the session.

A low of $3,924.48 pushed gold below the 78.6% retracement at $3,929.34 before the candle closed back above it. Gold was trading just above that final retracement, with the full November rally still intact.

ThinkMarkets said a move below $3,870.09 would erase the entire rally measured from its base.

Where are the next support levels?

ThinkMarkets places the remaining supports in a close cluster. The 78.6% retracement at $3,929.34 sits below the current candle, with the measured target at $3,906.48 next. The 2 November lows at $3,891.19 to $3,893.84 follow, then the rally base at $3,870.09.

A four-hour close below $3,870.09 would, in ThinkMarkets’ view, fully unwind the November rally and signal a resumption of the broader October downtrend.

RSI stood at 31.07, approaching oversold territory, against a 41.71 average and its lowest reading since 2 November. ThinkMarkets described the decline as stretched while noting that the current candle remained open.

The next downside markers are $3,906.48 and $3,870.09.

What closes would confirm or break the pattern?

ThinkMarkets based its scenarios on four-hour closes:

• A close below $3,929.34 would put the final retracement behind gold and bring $3,906.48 into focus. It would then expose $3,891.19 to $3,893.84 and $3,870.09.
• A close above $3,989.08 would reclaim the 61.8% retracement and its surrounding band. The descending trendline near $3,997 would be next, followed by the $4,027.51 to $4,034.16 neckline area.
• A close above the $4,027.51 to $4,034.16 neckline area, which gold failed to hold on Wednesday, would weaken the double top. A close above $4,148.54 would invalidate it.

Between those triggers, ThinkMarkets said gold was pausing at the 78.6% retracement and the “double top remains intact below the neckline.”

The pattern gains downside confirmation below $3,929.34, while $4,027.51 to $4,034.16 is the zone that would weaken it.

Why is the dollar pushing gold lower?

FxWirePro’s 12 November snapshot put spot gold down 0.7% at $3,959.03 an ounce by 07:32 GMT. That extended Wednesday’s 1.1% decline and Tuesday’s nearly 3% fall, taking gold to its lowest level in more than a week. FxWirePro said the same factors had weighed on gold all week.

The report cited October US inflation above forecasts, a hawkish tone from Federal Reserve officials and markets fully pricing a December rate hike. CME FedWatch data cited by FxWirePro put the odds of a half-point move at roughly 11%.

The dollar index rose for a third day to 103.02, its highest level since April 2025, FxWirePro said. ThinkMarkets wrote: “A stronger dollar and expectations of higher US rates have put pressure on non-interest-bearing gold.” US jobless claims at 13:30 UTC were the remaining scheduled release that day.

In ThinkMarkets’ view, the dollar-led macro pressure reinforces the technical break.

ThinkMarkets said its analysis is general market commentary, not investment advice. It warned that CFDs are complex and can lose money rapidly because of leverage. ThinkMarkets also said it accepts no liability for loss or damage, including lost profit, arising from use of or reliance on the information.

With gold near $3,936, the next test is whether a four-hour close holds above $3,929.34. A break would put $3,906.48 in focus, while a recovery through $3,997 would confront the descending trendline.