Gold tested a new 2-year low yesterday. Back from the weekend, gold has dropped to the early low near 1626 in the Asian session. However, the price has quickly rebounded. At the European session, it already reached the day-high at near 1649. Selling resumed in the late US session, where the day ended near the day-low at 1622.
The overall trend in the 1-hour chart is now bearish after the price cleared the 1650(1) support last Friday. Selling momentum so far isn’t too strong; an S-T downtrend channel(2) has been formed. Before the price consolidates further, clearing the support at 1620, the downtrend channel(2) can be used as a reference while trading with the 1620-50(3) range.
While the downtrend channel(5) still affects gold’s movement, the price has been moving lower tier by tier(4) on the daily chart. The range for each tier is approximately USD40 in the past 4 weeks. Expect the price to be bounded between 1610-50(4.1) temporary before the next move for now.
S-T Resistances:
1650
1645-46
1638-40
Market price: 1633
S-T Supports:
1630
1624
1620
Risk Disclosure: Gold Bullion/Silver (“Bullion”) trading carries a high degree of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. This article is for reference only and is not a solicitation or advice to trade any currencies and investment products . Before deciding to trade Bullion you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment or even more in extreme circumstances (such as Gapping underlying markets) and therefore, you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading Bullion, and seek advice from an independent financial advisor if you require. Client should not make investment decision solely based on the point of view and information on this article.