On April 24th, gold initially tested the low of 4693 before rebounding, but failed to break through the resistance at 4753. In late trading, it fell below the 4693 low, briefly touching around 4663 before quickly bouncing back. The session ultimately closed at 4693, with the daily chart forming a medium bearish candlestick, indicating an overall oscillatory downward trend.
Two key technical points were highlighted yesterday. First, the price action saw an early session dip and recovery followed by a rally and retreat, establishing two critical levels: 4753 and 4693. Second, when the price repeatedly hovers near the early session low, it signals a generally weak phase, increasing the likelihood of a breakdown and further decline. In such a scenario, selling on a rebound after the breakdown is advisable.
Given that gold's rebound highs are progressively lower and its lows are consistently being refreshed, the strategy suggested yesterday was primarily to look for selling opportunities below 4753. A break below the 4693 low would indicate an acceleration of the downtrend, though a brief long position could be considered upon the first sign of stabilization at 4693. Yesterday's U.S. session saw a rally followed by a retreat and a break below the low, marking the first signal of weakness. Subsequently, the price traded at lower levels overnight with weak rebounds unable to surpass the previous breakdown point, confirming the second signal of weakness. The key question now is the outlook for today and the critical levels to watch.
After a rapid dip to 4664 overnight followed by a quick recovery, the price briefly pierced below the previous key low of 4668. This area is now the focal point for today's session. Resistance above can be observed around yesterday's U.S. session high of 4743. As long as the price remains below this level, the potential for further declines persists. The operational strategy involves selling on rallies, using 4743 as a defensive stop-loss level. Another reference signal is the morning rebound high at 4711. If the price remains suppressed below this level into the afternoon, further selling is warranted. A break below 4664 would suggest selling on any subsequent rebound, particularly around the European session.
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