- Gold erases gains after facing rejection above key SMA hurdle.
- The pullback from session highs has weakened the immediate bullish case.
Gold is struggling to gather upside traction despite the bearish channel breakout on the hourly chart.
The yellow metal is currently trading largely unchanged on the day near $1,699, having printed a session high of $1,705 a few minutes ago.
The retreat from session highs marks a failure on the part of the bulls to keep gains above the descending (bearish) 100-hour simple moving average (SMA), currently at $1,706. Further, it has weakened the immediate bullish view put forward by the falling channel breakout seen early Tuesday.
If prices fall back below the descending 50-hour SMA at $1,694, it would mean the corrective bounce from the June 5 low of $1,668 has ended and the bears have regained control. On the higher side, a move above the June 1 high of $1,746 is needed to invalidate the lower highs setup on the daily chart and put the bulls back into the driver’s seat.
The 14-day relative strength index is reporting bearish conditions with a below-50 print. Prices, therefore, are likely to drop below support at $1,694.
Hourly chart
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Trend: Bearish
Technical levels
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