Gold is creating a strong negative movement, reaching a fresh four-month low of 1,680 earlier today. The aggressive selling interest started from the pullback off the 20-day simple moving averages (SMA) and the RSI indicator is suggesting further losses, diving into the oversold territory, in the short-term. However, the stochastics are indicating the end of the bearish structure as it posted a bullish crossover within its %K and %D lines.
If the price dips further, immediate support could come from the 1,723 area and the 1,676 low, registered on March 8. Steeper decreases could open the way for a decline towards the 1,451 support, taken from the bottom of March 2020.
On the other hand, a jump above the 1,750 resistance could move the market until the 20- and 40-day SMAs, which overlaps with the 1,800 psychological level. Marginally higher, the 200-day SMA could come next at 1,818 before meeting 1,834 and 1,855.
To sum up, the precious metal is returning to losses after the failed attempt to overcome the 1,834 resistance. More losses beneath 1,676 could shift the long-term outlook back to bearish as well.
