Gold Downtrend Threatens to Deepen as Recovery Hopes Fade

Gold Downtrend Threatens to Deepen as Recovery Hopes Fade

Key Highlights

  • Gold is struggling to settle above the $4,220 pivot zone.
  • A bearish trend line is forming with resistance at $4,160 on the 4-hour chart.
  • WTI Crude Oil found resistance at $102.40 and corrected some gains.
  • EUR/USD could start a recovery wave if it settles above 1.1285.

Gold Price Technical Analysis

Gold made another attempt to recover from $4,075 against the US Dollar. However, the bears remained active below $4,200 and $4,220.

The 4-hour chart of XAU/USD indicates that the price dipped below the 50% Fib retracement level of the upward move from the $4,073 swing low to the $4,198 high. More importantly, the price is still well below the 100 Simple Moving Average (red, 4 hours) and the 200 Simple Moving Average (green, 4 hours).

On the upside, there is a bearish trend line forming with resistance at $4,160 and the 100 Simple Moving Average (red, 4 hours). The first key resistance could be $4,200.

The main resistance might be $4,220 and the 200 Simple Moving Average (green, 4 hours) at $4,250. A clear move above $4,250 could open the door for more upside. In the stated case, the bulls could aim for a move toward $4,330.

If there is a fresh decline, the price could test $4,075. The first major support sits at $4,050. The next support could be $4,000, below which the price might slide to $3,880.

Looking at WTI Crude Oil, the bulls failed to clear the $102.40 resistance, resulting in a short-term bearish reaction.

Economic Releases to Watch Today

  • US Initial Jobless Claims – Forecast 200K, versus 199K previous.

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