Gold Price Analysis: Bears noting old support for a discount

The price of gold has broken into bearish territory below a 38.2% Fibonacci retracement.
Bears will seek a discount on a pullback to retest old support, expected to turn resistance.

Ross J Burland FXStreet

In the recent good news in markets, the price of the yellow metal has come under renewed pressure.

The yellow metal has completed a 38.2% Fibonacci retracement of the weekly bull trend and has closed below the level on a daily basis.

The following is a top-down analysis which illustrates where the next opportunity could be on a retest of an old support structure.

Monthly chart

Weekly chart

Does the correction have the legs to test the old resistance and confluence of either the 50% or 61.8% Fibonacci retracement areas?

Daily chart

As can be seen, the bulls may well be seeking a retest of the old support. If this area holds, then bears will be encouraged to risk positioning towards the next target area.

4-hour chart

As it stands, the price remains in bearish territory, but a break of the 21 moving average on the 4-hour time frame will open prospects of a test of the old support.

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

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