Gold finds support ahead of $1758 mark

Technical Analysis:

Gold dropped to $1770 mark on Tuesday before finding some support. The yellow metal is still testing its intermediate trend line support connecting $1721 and $1758 levels respectively. A bullish turn towards $1900 mark remains high probability from here.

Also note that Gold might be finding support close to the fibonacci 0.618 retracement of the entire rally between $1721 and $1877 levels. Immediate resistance is seen around $1810 and a break higher will confirm bulls are back in control.

Gold had rallied between $1677 and $1834 levels, subdividing into five waves, carving an impulse Wave (a) on the chart. The subsequent drop was corrective a-b-c, marked as Wave (b) at $1721. The metal has either completed Wave (c) at $1877 or progressing toward $1900 to terminate.

A critical support is seen at $1758 and till the time bulls are able to hold higher, the structure remains bullish for Gold. If the above is correct, bulls will be inclined to push prices toward $1900-30 zone, going forward.

Traders might be looking forward to initiate fresh long positions now ($1780), with risk below $1758. Watch out for a break above $1810 to confirm a bullish reversal.

Prepared by

Finacademy Technical Team