Gold drops toward $1,230, at 1-week lows

By FXStreet Gold continued to decline during the American session and broke below last week lows. The ounce bottomed at $1,232.60, the lowest since March 2. Price remains near the lows, falling 2% for the day.

From daily highs to lows it has fallen almost $30. The reversal is even bigger taking into account that on Friday it reached at $1,282.90, the highest level in a year and now is at the lowest in 12 days. From last week highs it dropped 3.75%.

No top but…

“The commodity is down for a second day in-a-row, but is far from suggesting an interim top, given that the daily chart shows that the price remains well above the 100 and 200 SMAs, both in the 1,130 region. In the same chart however, the price is below its 20 SMA for the first time since early January, while the technical indicators are heading south, approaching their mid-lines, suggesting a continued decline below the 1,200 level may open doors for a bearish extension,” said Valeria Bednarik, Chief Analyst at FXStreet.

In the short-term, Bednarik explains that the 4-hour chart presents a strong bearish tone given that the technical indicators head south almost vertically within bearish territory, while …read more

Source:: FX Street