Gold Pushes Higher as Central Bank Demand Reshapes the Market

Source: Coindoo Original Title: Gold Pushes Higher as Central Bank Demand Reshapes the Market Original Link: Gold is no longer trading like an asset that has simply benefited from a one-off macro shock. Instead, it is behaving like a market that has undergone a structural re-rating, driven by sustained official-sector demand and reinforced by renewed upside momentum on the charts.

Rather than stalling in a tight range, gold spent the past few weeks digesting gains before pushing higher again. Pullbacks were shallow, volatility remained elevated, and price consistently held above key support areas. That behavior is characteristic of trend continuation, not exhaustion.

Key Takeaways

• Gold is extending its uptrend after a continuation breakout, not a tight range
• RSI and MACD point to strength without signs of exhaustion
• Central banks have reshaped gold into a core reserve asset
• The declining dominance of the US dollar strengthens gold’s long-term support

The recent upside move followed a breakout from a multi-week triangle formation, a pattern that typically resolves in the direction of the prevailing trend. In this case, the trend was already higher. The breakout confirmed that buyers were using pauses to accumulate rather than distribute.

At the time of writing, gold is trading near $4,510 per ounce, up roughly $56.97 (+1.28%) on the day, extending a structure of higher highs and higher lows.

Momentum Confirms Strength, Not a Blow-off

Technical indicators support the price action. On the 4-hour timeframe, RSI is holding in the mid-60s, signaling strong momentum without reaching extreme conditions. This is often seen in trending markets where upside pressure remains intact.

MACD has also turned higher after resetting during the brief consolidation phase. The histogram has flipped back into positive territory, suggesting that downside momentum has faded and bullish pressure is rebuilding.

Volume expanded during the breakout, reinforcing the move’s credibility. This was not a thin, mechanical push higher, but one accompanied by participation.

Gold’s Role Has Fundamentally Changed

What makes this cycle different from past gold rallies is who is buying and why.

Gold is no longer being accumulated primarily as an inflation hedge or a crisis trade. It has increasingly become a core reserve asset, particularly for central banks seeking to reduce exposure to concentrated fiat risk.

Central banks have been consistent, price-insensitive buyers for several years, and their behavior has reshaped the market’s structure. Unlike speculative investors, central banks rarely sell, meaning their demand tends to create a durable floor under prices.

This shift accelerated after geopolitical shocks highlighted the vulnerability of traditional reserve assets. Gold’s appeal lies in its neutrality: it carries no counterparty risk, cannot be frozen, and sits outside the influence of any single political system.

The Reserve Shift Explains Why Gold Isn’t “Cooling Off”

The evolving reserve landscape makes it easier to understand why gold has not followed the historical script of sharp rallies followed by long stagnation.

The US dollar still dominates global reserves, but its share has fallen to around 40%, the lowest level in at least two decades. Over the past ten years, that figure has dropped by roughly 18 percentage points, reflecting a slow but persistent diversification trend.

Gold has absorbed much of that shift. Its share of global reserves has risen to about 28%, the highest since the early 1990s, after increasing roughly 12 percentage points over the past decade. Gold now represents a larger portion of global reserves than the euro, Japanese yen, and British pound combined.

This is not a tactical move by central banks. It is a strategic reallocation away from fiat concentration.

Why This Matters for Price Going Forward

Because central banks buy steadily and rarely exit positions, their demand does not behave like typical investment flows. It does not chase momentum, but it also does not disappear during corrections. That dynamic helps explain why gold’s pullbacks have remained controlled despite its historic run.

Instead of heavy profit-taking, the market has shown absorption. Instead of volatility collapsing, momentum has rebuilt.

That combination—structural demand from central banks and trend-confirmed price action—is why gold continues to trade with a bid even after one of its strongest years on record.

Not a Repeat of Last Year—But Not a Top Either

Few expect another explosive surge like 2025. But the current setup suggests something different: a market transitioning from a breakout phase into a sustained trend, supported by forces that move slowly and reverse even more slowly.

Gold is no longer just reacting to macro headlines. It is being repositioned within the global monetary system—and the chart is beginning to reflect that reality.