SINGAPORE: Spot gold may end its bounce around a resistance at $2,020 per ounce, and resume its fall towards $2,003.
The bounce triggered by the support at $2,003 looks weak, unable to extend above a resistance at $2,020.
Even though the upper trendline of a wedge suggests a higher bounce target of $2,031, the underperformance of the metal simply makes this target look unachievable.
A break above $2,020 may lead to a gain limited to $2,031.
Immediate support is at $2,011, a break below which could open the way towards $1,992-$2,003 range. On the daily chart, gold is due for a deep correction, as suggested by the bearish divergence on the daily RSI.
Its consolidation above the support at $2,004 could be temporary.
Spot gold may end bounce around $2,031 and fall
The correction could easily extend into a range of $1,897-$1,964, as indicated by a retracement analysis on the uptrend from $1,613.60.
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