Gold outlook: Sharp pullback from new all-time high warns that bulls might be losing traction
Gold
Gold keeps firm tone in early Monday, despite strong pullback from new record high ($2431) in late Friday trading.
Growing geopolitical tensions and fears of escalation of the conflict in the Middle East continue to fuel demand for safe haven bullion, with strong buying from the central banks and prospects of Fed rate cuts in coming months, adding to bullish outlook.
However, Friday’s strong upside rejection, which left bearish daily candle with long upper shadow, generates initial signal of a bull-trap and warns that bulls may take a breather for consolidation / shallow correction on overbought conditions
Solid supports at $2329 (rising 10DMA) and psychological $2300 level should keep the downside protected for fresh push higher, with break of $2431 to expose targets at $2453 and $2500
Caution on dips below $2300 handle which would risk test of lower pivot at $2260 (Fibo 38.2% of $1984/$2431 upleg), reinforced by rising 20DMA.
Res: 2372; 2400; 2431; 2453.
Sup: 2329; 2300; 2260; 2224.
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