Gold: Breakout Extends Upside Momentum – Société Générale

Société Générale analysts' latest view indicates that gold has broken above a previously formed small base pattern, reclaimed its 200-day moving average, and extended its rebound from the cyclical low. As of press time, spot gold is trading near $4,643.70855.

**Technical Pattern Confirms Rebound Momentum**

The analysts noted that gold's rebound from a cyclical low of around $4,270 and its breakout above the December high mark a resurgence of upside momentum after successfully holding its multi-month uptrend line. Reclaiming the 200-day moving average is seen as a key signal of trend repair, with this breakout occurring against a backdrop of broader U.S. dollar depreciation concerns and rising term premiums.

**Allocation Logic Simultaneously Strengthened**

According to market sources, Société Générale has recently increased its gold allocation in its multi-asset portfolio from 7% in Q2 to 10%, restoring it to a full-weight level, while also raising its overall commodity allocation from 8% to 10%. The bank believes major global central banks may still lag behind the inflation situation going forward, and portfolios need enhanced inflation protection, with the recent gold pullback providing an opportunity to rebuild positions.

**Medium-to-Long-Term Targets Remain Optimistic**

SocGen expects gold prices to begin recovering in Q4 of this year, reclaim the $5,000/ounce level in Q2 2027, and potentially set fresh record highs by Q3 2027. However, short-term disruptions persist—if U.S. May PCE data comes in above expectations, it could reinforce hawkish signals from the Federal Reserve and pressure gold prices.