In a surprising move, gold prices fell over 3% during the same week when the safe-haven asset hit a seven-year high. The drop is blamed on investors having to book profits to fund margin calls in riskier assets. Similar trends were seen in other metals such as Platinum and Silver. Silver prices were down close to 10%.
XAU/USD Short Term Correction was Quick
The decline in gold prices was quick. After failing to break past the 1655 resistance, price turned bearish rather quickly. This led to the initial break down below 1631.90 and later price action fell to the lower support at 1572 – 1568. In the near term, we expect a rebound with price likely to trade within the said levels.
