Gold maintains a weak bias in near term; the broader trend is neutral since January.
Gold has plummeted during today’s European session after the bounce off the 1325.75 resistance level. It is worth mentioning that the price has been trading within a trading range since January 25 with the 1365 resistance level being the upper boundary and the 1307 support level the lower boundary as it lacks a clear trend.
Technically, in the 4-hour chart, the RSI indicator is sloping to the downside and is approaching oversold levels, while the stochastic oscillator posted a bearish cross within the %K line and the %D line, signaling further downside pressure.
In the wake of negative pressures, and a drop below the lower Bollinger band, which overlaps with the 1315.15 support level, the market could meet 1307. A successful close below this level could see a break of the consolidation zone and drive the precious metal lower towards 1303.
However, if prices are able to break above the 20- and 40-simple moving averages in the short-term near 1321.30 and 1327.70 respectively in the next few sessions, the risk would shift to the upside, specifically towards the 1332.50 resistance level.
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