Gold Technical Analysis: Rising wedge restricts the surge
- Gold trades little changed near $1317 in early Asian trading session.
- Prices extend their pullback from “Rising Wedge” trendline resistance initiated on Thursday.
- $1306 and $1300 seem immediate supports whereas $1326 and $1333 can restrict immediate upside of the yellow metal.
Gold trades around $1317 on early Monday. The yellow metal took a U-turn from near-term “Rising Wedge” resistance on Thursday. Strong US Nonfarm Payrolls extended the bullion’s pullback on Friday whereas lack of fresh signals continued dragging the quote downwards in early Asian trading at the week start.
Gold: Daily chart
Considering the importance of resistance-line and declining 14-day relative strength index from overbought territory, Gold prices may depreciate further towards $1306. Also, the $1300 and the $1295 could offer intermediate halts to the quote under $1306 before highlighting the bearish pattern support currently around $1286.
Should there be additional weakness on the part of the yellow metal after $1286, the bearish formation gets confirmed, which in-turn opens the door for the price plunge to 50-day simple moving average (SMA) of $1268.50 and then to the $1246 comprising 200-day SMA.
Meanwhile, an upside clearance of $1326 on a daily closing basis can trigger the bullion’s recovery to $1333 and to the $1340. Also, buyers’ capacity to conquer $1340 enables them to aim for $1355 and the $1366 resistances.