- Gold regains some traction but remains well within a familiar trading range.
- Bulls need to make it through 100-DMA before aiming towards $1500 mark.
Barring a couple of knee-jerk spikes, gold has been oscillating well within a range over the past one week or so and remained capped below the 100-day SMA. The range-bound trading action constituted towards the formation of a rectangle on hourly charts, which is usually seen a continuation pattern that forms during a pause in the trend.
Given the recent pullback from multi-year tops and a subsequent break below 100-day SMA, the set-up remains in favour of bearish traders. This coupled with the fact that the commodity has been trending lower along a two-month-old descending trend-channel further points to a well-established downtrend and reinforces the bearish bias.
Moreover, technical indicators on the daily chart have struggled to recover from the negative territory and reinforce prospects for an extension of the recent pullback from multi-year tops. Hence, some follow-through weakness, towards $1457-55 support zone en-route monthly swing lows around the $1445 region, remains a distinct possibility.
On the flip side, immediate resistance is pegged near the $1481-82 region (100-DMA), above which the commodity is likely to head back towards reclaiming the key $1500 psychological mark before eventually aiming to challenge a resistance marked by the top end of the mentioned trend-channel, currently near the $1509-10 region.
Gold daily chart
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