Gold (XAU/USD) slides during the New York session, down almost 1%, trading at $1,782 at the time of writing. Earlier in the session, gold reached a fresh weekly low at $1,771 but bounced off the lows to stabilize at current levels.

Risk-off market sentiment spurred a flight towards safe-haven assets, but it failed to uplift the non-yielding metal. Concerns about high inflation, central bank tightening, and some CEOs from US companies complaining about supply shortages and high production costs dented the market mood. Gold witnessed aggressive selling during the early North American session and dived to one-and-half-week lows, around the $1,776 region in the last hour. The US dollar was back in demand on the last trading day of the week and has now reversed a major part of the previous day's dismal US GDP-led slide to one-month lows. This, in turn, was seen as a key factor that weighed heavily on dollar-denominated commodities, including gold.

BULLISH AND BEARISH CONDITIONS/ POSSIBILITIES :

From a technical perspective, repeated failures near the $1,810-12 resistance zone and the subsequent fall suggests that the recent positive move has run out of steam. Hence, some follow-through weakness towards testing the next relevant support, near the $1,762 region, remains a distinct possibility. The corrective pullback from multi-week tops could further get extended towards October monthly swing lows, around the $1,745 area.

On the flip side, any meaningful recovery now seems to confront stiff resistance near the $1,790-92 region (100/200-day SMAs confluence) and remain capped near the $1,800 mark. A sustained strength beyond could allow bulls to make a fresh attempt to clear the $1,810-12 barrier and push gold prices towards the $1,832-34 heavy supply zone.

Gold In A Range Bound Structure

Oct 30 2021