Gold (XAU/USD) is facing renewed downward pressure after a key technical pattern breakdown, raising the risk of a more pronounced decline in the coming weeks. Recent price action shows gold struggling to maintain momentum above the crucial $3,400 level—a zone that previously served as a springboard for further gains. The inability to secure a daily close above this threshold has shifted sentiment, with traders now watching closely for potential support near $3,375 and $3,350.

Technically, gold had been forming higher highs in recent months, but its failure to sustain a breakout above the upper boundary of its consolidation triangle is a significant red flag for bulls. If selling persists, a retest of the immediate support at $3,400 is likely, followed by deeper tests down to $3,375 and possibly lower, as bearish momentum builds.

Sentiment data further highlights growing market uncertainty. Overall, trader positioning remains nearly balanced, indicating a lack of strong conviction about gold’s next move. This indecision underscores the potential for increased volatility, particularly if key support levels give way.

On the macro side, gold’s outlook is complicated by mixed signals from global markets. While some projections predict that gold could still attempt higher levels by year-end, caution is warranted. Unless bulls can decisively reclaim and hold the $3,400 zone, the risk of further downside remains elevated.

Traders should keep a close watch on upcoming technical levels, market sentiment, and macroeconomic factors. A convincing move above $3,400, confirmed by strong daily closes, could reignite bullish momentum and target the $3,800 handle. Until then, gold is vulnerable to further declines, and a cautious, risk-managed approach is advised in the current trading environment.