SINGAPORE: Spot gold may retest a resistance at $1,856 per ounce, a break above which could lead to a into a range of $1,864-$1,871.
The drop from $1,877.05 has been so deeply reversed that the reversal suggests an extension of the uptrend from $1,786.60.
A retracement analysis on the uptrend reveals a resistance at $1,856 which temporarily stopped the rise.
It triggered a correction which may end in the support zone of $1,834-$1,839.
Gold prices fall, set for biggest weekly drop in a month
A break below $1,834 may be followed by a deep fall into $1,816-$1,824 range.
On the daily chart, the surge on Friday has sabotaged the development of a downtrend within a falling channel.
However, to confirm an establishment of an uptrend, gold has to break a resistance at $1,867.