Home Stocks Gold Plunges to New One-Month Low

Gold Plunges to New One-Month Low

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Gold prices are plummeting towards a fresh one-month low at 1,714 and are holding well below the short-term simple moving averages (SMAs). The RSI indicator is ticking lower in the negative region, approaching the oversold territory, while the MACD is extending its bearish momentum beneath its trigger and zero lines.

More downside pressures may open the door for a lower low towards the 1,711 barrier, taken from the lows on July 27. Even lower, the market may hit the 1,680 barrier again, where it has been rejected several times over the last two years.

On the flipside, an upside correction may drive the price towards the 20-period simple moving average (SMA) at 1,733 in the 4-hour chart. Higher, the bulls may find strong resistance near the 23.6% Fibonacci retracement level of the down leg from 1,807 to 1,720 at 1,741, which overlaps with the 40-period SMA. Slightly up, the downtrend line, which is drawn from the peak on August 10 may act as strong resistance near the 1,745 barrier.

All in all, the yellow metal is bearish and only a climb beyond the falling trend line and the 200-period SMA may switch this outlook to slightly positive.

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