Gold recovers from $2,353 – Is a further decline coming?
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Gold dropped to $2353 and bounced back to $2380
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Markets awaiting PCE numbers.
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$2400 likely to come as resistance.
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Bears still looking for selling higher.
In previous reports we have been emphasizing our bias of bearish selling pressure dominating from $2430-$2435 and markets have done exactly as per our projections by reaching $2353 yesterday.
Today's opening witnessed some dead cat bounce that triggerred a relief rally towards $2380 and it was soon followed by sideways consolidation above horizontal support zone $2368-$2362.
As markets await key data results on PCE which is widely believed to be an important tool used by Fed to gauge inflation and further guidance on policy, we expect volatility to increase with the opening of US markets.
Immediate resistance may come at $2388-$2392 while strong break above this resistance will increase the possibility of extended recovery to $2400 followed by next overhead resistance $2410.
On the flip side, rejection from key resistance zone may trigger renewed selling pressure towards swing low $2353 while break below this low will send gold down direct to $2335-$2330.
Major support is seen positioned at 100 Day SMA $2324.
Disclaimer: The views expressed are based on prevailing trend analysis and price action. Please do not take it as trading advice.
Author
Sunil Kumar Dixit
SK Charting
Sunil Kumar Dixit is Chief Technical Strategist and founder of SK Charting, a research firm based in India. He tracks Precious Metals, Energy, Indices and Currency Pairs. He also participates as an expert panellist on Channel Television, Nigeria.
