Gold retest back the SMAs and drops with the beginning of this week – analysis - 07-11-2016
Gold opened trading on a decline with the onset of trading this week after the rally witnessed by the metal during the previous week; the move which ended by facing back the SMAs 50 and 100, which coincided with facing the resistance level of 1305. Where the metal during trading Monday fell influenced by these resistances after falling during trading last weeks from the level of 1375, breaking the pace of previous bullish movement represented by the bullish trend line shown on a long previous term trading, in addition to the appearance of an overbought on the stochastic indicator, which adds more negative pressure on the yellow metal movement. As the level of 1305 represents 23.6% correction level for the long-term previous boarding from 1046 to 1375, which adds more resistance to this level in addition to the resistance of SMAs, which the price traded below it during the previous trades. Generally; the price of gold responds to the recent negative signals trading below the resistance 1305, as the continuation of holding below that resistance will push it to further decline, which aims to re-retest the support 1250 in sync with the correction level of 38.6% for the same boarding, but trading back above the resistance level of 1305 would return back the bullish moves in order to try to skip the resistance 1343 initially.