Gaza Peace Plan Challenges Gold’s Record High at $4,000 — Technical Overbought Signals Correction

TradingKey - After gold’s historic breakthrough above $4,000 per ounce, easing geopolitical tensions in the Middle East have cooled investor enthusiasm, while its overbought technical condition is prompting traders to consider profit-taking.

On Monday, October 9, during Asian trading hours, gold pulled back from a record high of $4,050 per ounce, declining 0.66% to $4,014.05/oz.

Gold Price Chart, Source: TradingKey

U.S. President Donald Trump announced on social media on October 8 that Israel and Hamas (the Palestinian Islamic Resistance Movement) had agreed to the first phase of a U.S.-proposed peace plan for the Gaza Strip. Both Hamas and Israel later issued statements confirming the agreement.

Gold, long regarded as the premier safe-haven asset during times of political and economic turmoil, reacted swiftly to the news. Just days earlier, the precious metal had hit new all-time highs, driven by:

• Heavy inflows into gold ETFs
• Continued central bank buying
• Political instability in France and Japan
• Fed rate cut expectations
• A weakening U.S. dollar

So far in 2025, gold has surged over 53%. Even after surpassing the $4,000 milestone, Wall Street analysts project it could advance toward $5,000 by the end of 2026.

From a technical perspective, the sharp rally has pushed gold’s Relative Strength Index (RSI) to 87, well into overbought territory. With the de-escalation in the Gaza conflict reducing gold’s immediate safe-haven appeal, a short-term correction appears increasingly likely.

Market participants are now assessing whether this pullback marks a pause before the next leg higher — or the beginning of a deeper retracement.