- Gold extended this week’s retracement slide and remained depressed for the second straight day.
- The technical set-up seems tilted in favour of bears and supports prospects for further weakness.
- Break below a near three-month-old ascending trend-line will add credence to the bearish bias.
Gold remained under some selling pressure for the second consecutive session on Thursday and extended this week’s retracement slide from the $1992 area. The downward momentum dragged the commodity to fresh weekly lows, with bears now eyeing a sustained breakthrough a near three-month-old ascending trend-line.
Meanwhile, technical indicators on hourly charts have been gaining negative traction and have just started drifting in the bearish territory on the daily chart. The set-up favours bearish traders and supports prospects for an eventual breakthrough the mentioned trend-line amid sustained buying around the greenback.
Sustained weakness below will be seen as a fresh trigger for bearish traders and turn the commodity vulnerable to slide back towards the $1900 round-figure mark. Some follow-through selling should pave the way for additional weakness, possibly back towards August monthly swing lows support near the $1863 region.
On the flip side, immediate resistance is now pegged near the $1948-50 horizontal zone, above which bulls are likely to push the commodity back towards the $1970 supply zone. The momentum could further get extended towards weekly tops, around the $1692 level before the metal aims back to reclaim the key $2000 psychological mark.
Gold daily chart
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Technical levels to watch
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