- Bulls once again managed to defend 3-1/2-month-old ascending trend-line support.
- Neutral set-up warrants some caution before placing any aggressive directional bets.
Gold once again managed to find some support near a 3-1/2-month-old ascending trend-line and has now moved into the positive territory, with bulls looking to extend the momentum further beyond the key $1500 psychological mark.
The intraday uptick remained supported by a subdued USD demand and a follow-through pullback in the US Treasury bond yields, though signs of stability in the global risk sentiment might keep a lid on any meaningful appreciating move.
The mentioned ascending trend-line support – coinciding with 23.6% Fibo. level of the $1269-$1557 up-move – has been lending some support over the past one week or so and should now act as a key pivotal point for short-term traders.
Meanwhile, technical indicators on hourly/daily charts haven’t been supportive of a firm near-term direction, making it prudent to wait for a sustained move in either direction before positioning for the commodity’s near-term trajectory.
A sustained breakthrough the mentioned confluence support – currently near the $1494-90 region – will confirm a near-term bearish breakdown and set the stage for an extension of the near-term corrective slide from multi-year tops.
A follow-through weakness below 50-day SMA will reinforce the negative outlook and turn the yellow metal vulnerable to accelerate the slide back towards a previous resistance breakpoint, now turned support near the $1450-46 region.
On the flip side, any subsequent move up now seems to confront some fresh supply near the overnight highs, around the $1512 zone, above which bulls are likely to aim towards testing the $1522-24 region (post-ECB volatility swing high).
Gold daily chart
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