Gold Slides After Hitting Resistance Near 1237

Gold traded lower after it hit resistance fractionally below the 1237 barrier. Although the metal continues to trade above the medium-term downside line drawn from the peak of the 11^th of April, as well as above the upside support line taken from the low of the 16^th of August, in the short run, it remains stuck within the range that has been containing most of the price action since the 15^th of October, between 1220 and 1237. Therefore, we will adopt a flat stance for now with regards to the near-term outlook.

If the bears maintain their momentum and manage to overcome the 1220 barrier, which is the lower end of the aforementioned range, then we may experience extensions towards the low of the 31^st of October, at around 1212. Another dip below 1212 could set the stage for our next support, at around 1207, which is near the peaks of the 2^nd, 3^rd and 4^th of October.

Shifting attention to our short-term momentum studies, we see that the RSI lies below 50 and points down, while the MACD stands below both its zero and trigger lines, pointing south as well. These indicators detect negative momentum and support the notion for this metal to keep trading lower for a bit more.

On the upside, we would like to see a clear break above the range’s upper bound, at around 1237, before we start examining whether the bulls have taken the upper hand. Such a break may initially aim for the peak of the 26^th of October, near 1243. However, we would like to see a move above the 1245 zone, marked by the highs of the 16^th and 17^th of July, before we get confident on more upside extensions. Such a break could pave the way for the psychological barrier of 1250.

---

Boost your performance with JFD Brokers’ proven DMA/STP. Don’t change your style, change your broker!

---