Gold has been experiencing a sustained downtrend since early March, generating a profound structure of lower highs and lower lows. Although the precious metal managed to cease its decline at the one-year low of 1,681 and recoup some losses, its bearish technical picture remains intact.
The momentum indicators reflect a cautiously positive near-term bias. Specifically, the stochastic oscillator is sloping upwards towards its 80-overbought zone, while the MACD has crossed above its red signal line but remains in the negative territory.
Should buying interest intensify further, the price may encounter initial resistance at the 1,755 barrier. Any further advances could then stall at the May support of 1,787 before the 1,880 peak appears on the radar. An upside violation of the latter could open the door for the 2,000 psychological mark.
On the flipside, should the decline resume, the one-year low of 1,681 might act as the first line of defense. Breaching this zone, the spotlight could turn to 1,640, which acted both as support and resistance in April 2020. Failing to halt there, the bears might then aim for the March 2020 support of 1,570.
Overall, even though the market is trying to push for some recovery in the past few daily sessions, gold maintains both its bearish short- and long-term outlooks. For the former to alter, the price needs to decisively cross above the 1,880 ceiling.
