Spot gold may test support at $1,719

SINGAPORE: Spot gold may test a support at $1,719 per ounce, a break below which could cause a fall into $1,677.77-$1,697 range.

The bounce from $1,677.70 has ended at $1,758.45, as suggested by the following deep fall from this level. What was thought to be a double-bottom pattern around $1,678 may turn out to be a flat.

The flat would mean a drop towards $1,677.70.

A realistic target could be either $1,719 or $1,697. A break above $1,744 may lead to a gain to $1,758.

A further gain could confirm a double-bottom, and a bullish target of $1,852 will be established.

On the daily chart, gold is pulling back towards a falling trendline. The pullback may extend to any level until $1,693.

The current speculation is the bounce from the March 8 low of $1,676.10 could be similar to the one from the Nov. 30 low of $1,764.29.

Under this assumption, gold is unlikely to fall below $1,692. Signals will become very bearish if the metal breaks this level.

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