SINGAPORE: Spot gold may bounce a bit further to $1,783 per ounce, before turning around and retesting a support at $1,764.
After a moderate consolidation, the metal managed to stabilize around a support at $1,764. A temporary bottom formed which guaranteed a further bounce.
The deep fall from the Oct. 15 high of $1,796.28 signals a reversal of the uptrend from $1,720.49, which may be revisited in due course.
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A break below $1,764 could confirm the continuation of the downtrend. On the daily chart, the consolidation within a wedge continued, following a failure of the metal to break a falling trendline resistance around $1,800.
The current bounce looks like a pullback towards a former support at $1,773. The bearish outlook will only be revised when gold breaks above $1,800.
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