Gold: Downside risk below 200-DMA – Societe Generale

FXStreet Insights Team FXStreet

Societe Generale analysts observe that Gold has been under pressure since losing its 50‑DMA in March and failing to reclaim it on rebounds. They flag the confluence of the 200‑DMA and a multi‑year trend line near $4,350 as critical support, with potential downside towards $4,100 if this area fails, and recent highs acting as resistance.

Downtrend eyes major support cluster

"Gold has undergone a pullback after slipping below its 50‑DMA in March."

"Its failure to reclaim this MA during the latest rebound attempt underscores the persistence of downward momentum."

"The confluence of the longer‑term 200‑DMA and a multi‑year ascending trend line near $4,350 could be next potential support."

"It will be important to observe whether Gold can hold above this and attempt a bounce."

"Gold erased the key $4,500/oz level and must hold the 200dma of $4,353/oz to halt a deeper correction towards $4100/oz."

"If a short‑term rebound develops, the recent pivot high around $4,685 / $4,775 could act as resistance."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

GBP/USD stays offered near 1.3370

GBP/USD remains on the back foot, slipping back toward the 1.3370 zone on Tuesday. Cable has come under pressure soon after testing the 1.3400 neighbourhood as investors turned more cautious in response to renewed effervescence on the geopolitical front.

EUR/USD stays offered below 1.1450

EUR/USD remains on the back foot ahead of the opening bell in Asia, returning to the low-1.1400s on the back of the resurgence of the demand for the US Dollar. Indeed, renewed jitters in the Middle East support the safe haven universe and weigh on the sentiment surrounding the risk complex. Moving forward, investors’ attention should shift to Wednesday’s FOMC Minutes.

Gold weakens toward $4,100

Gold adds to Monday’s decent pullback and trades close to the $4,100 mark per troy ounce on Tuesday. In the meantime, fresh geopolitical effervescence appear to have reignited inflation concerns, which in turn, limit any recovery attempt from the precious metal.

RBNZ set to increase interest rate after three pauses amid deeply divided committee

The Reserve Bank of New Zealand is widely expected to raise the Official Cash Rate by 25 basis points from 2.25% to 2.50% on Wednesday, snapping a three-consecutive-meeting pause.

Bye, forward guidance: How to trade when central banks choose silence

Central banks have spent years telling markets what might come next. Now, traders face the possibility that they say a lot less. From the Federal Reserve to the European Central Bank and the Bank of England, policymakers are pushing back against forward guidance, arguing that the current world demands more flexibility.