Gold braces for the first weekly gain in three while bouncing off a two-year low inside a one-month-old bearish channel. That said, the metal’s latest recovery approaches a fortnight-old hurdle surrounding $1665. Any further upside, however, will be challenged by the stated channel’s upper limit, close to $1,680. If the buyers manage to defy the bearish chart pattern, the 200-SMA level surrounding $1,707 could act as the last defense of the bears before activating the run-up to refresh the monthly top, currently around $1,734.
Alternatively, gold’s pullback may aim for the latest swing low surrounding $1,641 before directing the bears towards the yearly bottom of $1,614. In a case where the bullion sellers keep controls past $1,614, the aforementioned channel’s bottom at around $1,607 and the $1,600 should probe the further downside. It should be noted that the quote’s weakness past $1,600 won’t hesitate to aim for the tops marked during August and September 2019, around $1555-57.
Overall, gold holds onto the bearish trajectory but a short-term rebound can’t be ruled out.