The bullish sentiment has been deeply hurt, with the correction from the Aug. 23 high of $1,911.46 narrowly missing $1,695, the 50 percent Fibonacci retracement on the rise from $1,478 to $1,911.46.

It will take some time for the bulls to regain their strength to push the metal up. A long-shadowed hammer formed on the daily chart, signaling the possible bullish reversal at the previous trading session's low of $1,702.44.

The metal may first retrace to $1,739 on Friday.

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Copyright Reuters, 2011