The precious metal has been on a downward trend for seven of the last eight trading sessions. The price managed to break the support at $1,824 after the pair was trading above the upper Bollinger band, which suggested that the price was relatively high and drove the price line down.
Gold could find an important support at $1,796; this level is at the 50% Fibonacci retracement and is usually a strong support level. If the price continues to fall and the support breakout is consolidated, we would have a reversal, and the general trend will then be downwards.
The price trades in between the Bollinger bands, which are very wide; however, they are closing up, which will bring lower volatility in the upcoming sessions. Our parabolic SAR indicator suggests that the downtrend will continue, but it's too early to determine. We would have to wait and see if Gold can find support or the breakout is consolidated.
The relative strength index is currently at 43%, which will allow the pair to continue moving in either direction before being oversold or overbought.
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