Gold remains sluggish despite the dollar taking a bit of a breather
Bias in gold remains bearish after this week’s firm break below the 200-day MA (blue line). At the same time, that move took out support from the 50.0 retracement level @ $1,301.35 as well as the psychological level at $1,300.00.
That has seen gold move towards the next support level at the 61.8 retracement @ $1,286.06. And that is where the decline yesterday came to a halt. Today’s trading so far has been inching closer towards that support level again so that will be a key level to watch out for.
A break below opens up a move towards the 76.4/23.6 retracement level @ $1,267.14 with further support down to the $1,260.00 level from daily lows stretching back to October last year. After which of course is the December low @ $1,236.55.
For buyers, there is much needed work to be done. First is to get back above the $1,300.00 psychological level and then break back above the 50.0 retracement level and the 200-day MA as mentioned above. And even then, that will only start to rebuild the foundations of a bullish bias in the commodity.
But for now, sellers remain in control as we lean towards another key support level.