Spot Gold holds in red on Tuesday and dips below $1250 handle, as dollar strengthened on short-covering. Bearish signal was generated on Monday’s strong upside rejection at $1265 (Fibo 38.2% of $1309/$1237) and subsequent easing which resulted in formation of Shooting star pattern. Extension of pullback from two-week high at $1265 dipped so far to $1247, marking over 61.8% retracement of $1237/$1265 recovery leg. The weakness brought daily MA’s back to full bearish configuration, while slow stochastic is heading south and 14-d momentum turning lower, setting environment for further weakness. Close below $1248 (Fibo 61.8% of $1237/$1265) is needed to generate further negative signal for extension towards $1244 (Fibo 76.4%) and open way for full retracement of corrective leg from $1237. Broken 10SMA ($1252) and broken Fibo 38.2% at $1255, mark solid barriers which are expected to limit upticks and keep fresh bearish bias in play.
Res: 1252; 1255; 1260; 1265
Sup: 1247; 1244; 1237; 1234
