Gold is currently tiptoeing sideways after its recent bounce off the critical support base of 1,660-1,682, where it produced a nine-month low of 1,676. The falling 50- and 100-day simple moving averages (SMAs) are safeguarding the short-term bearish picture and weighing on the commodities price. The flattening Ichimoku lines are suggesting positive momentum has dwindled and are promoting a minor directionless price phase.
The short-term oscillators are slightly favouring the downside, as they are indicating that positive sentiment has become subdued with the latest drifting in price action. The MACD, although above its red trigger line in the negative region, is looking set to retest it, while the downward tilting RSI, is hovering beneath the 50 level. The persisting negative charge in the stochastic oscillator is recommending a gloomier price picture, as the %K line has failed to overstep its %D line.
Should upside momentum continue to evaporate, sellers may encounter initial downside constraints from the nearby lower wicks of 1,719 and 1,699 respectively. Steering the commodity lower, the crucial foundation of 1,660-1,682 could prove to be a noteworthy obstacle to overcome. However, if the April-June 2020 section of troughs fails to provide buyers with necessary footing, the 1,643 border could then play its part in a clear shift in the bias to the downside.
Otherwise, if buyers re-emerge, immediate resistance could commence from the Ichimoku lines from 1,737-1,746, ahead of the ceiling of 1,757-1,768 of the sideways developing pattern. Surpassing this, buyers will still need to beat the 50-day SMA at 1,780 before tackling the Ichimoku cloud. If buying interest intensifies, the 1,816 high and the 100-day SMA overhead at 1,820 could then challenge buyers’ efforts to re-establish a climb.
Summarizing, the gold scale seems to be tilting to the downside. A break of the floor of 1,660-1,682 or the ceiling of 1,757-1,768 would confirm the next price direction.
Written by Admin
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