Gold in neutral bias after challenging a 3-month high.

Gold prices posted significant losses on Monday, diving below the 20- and 40-simple moving averages (SMAs) in the 4-hour chart, which is ready to post a bearish crossover in the near future. The price holds in a neutral bias after the jump above of the sideways channel of 1180.60 – 1212.50, while the technical indicators are confirming the recent bearish movement. The RSI is pointing down near the threshold of 50 and the MACD oscillator remains below the trigger line but above the zero line.

In case of more downside pressures, the market could meet support at around 1220.50, before moving down towards the 23.6% Fibonacci retracement level of the up-leg from 1160 to 1233, near the 1216 support. More losses could see the price retesting the 1212.50 level before it heads lower to the 20-SMA, currently at 1208.30.

An upside movement could drive the precious metal towards the 1233 resistance level, taken from the high on October 15. A significant leg above this barrier could send prices until the next immediate resistance of 1238, achieved on July 3. Moreover, a jump higher could challenge the 1265.60 resistance, where it topped on July 6.

Having a look at the very short-term timeframe, gold prices failed to post another impressive upside rally and are holding below the three-month high of 1233. A significant leg above this level could open the way for a bullish tendency.

Gold 22/10/18 | EconAlerts



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Source: XM

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