Gold – One Month Low as Pressure Grows on Support

Gold is selling off again today and looks likely to continue after breaking below $1,100 for the first time in a month.

The yellow metal has already found support at this level once this week and failed to break through. It’s worth noting that 3 weeks prior to it breaking above here on 11 August, this area was strong resistance, which quite often leads towards it being support on the way back down.

Gold Daily

If we see a break below here, the next area of support could come around $1,071.80-1,082.50. This was a key area of support between 20 July and 7 August when it hit its lowest level since 11 February 2010.

Below here, the ascending trend line – 14 June 2006 lows – could offer further support between $1,050 and $1,055 depending on if/when it reaches this level.

Another failure at the current support may be an early sign that the bearish pressures are easing. If we see a break above the descending trend line – 24 August highs – this would further support that view as it would appear to break the recent trend and break above prior support and resistance levels.

Gold 4hr

Craig Erlam
Based in London, England, Craig Erlam joined OANDA in 2015 as a Market Analyst. With more than five years' experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while conducting macroeconomic commentary. He has been published by The Financial Times, Reuters, the BBC and The Telegraph, and he also appears regularly as a guest commentator on Bloomberg TV, CNBC, FOX Business and BNN. Craig holds a full membership to the Society of Technical Analysts and he is recognized as a Certified Financial Technician by the International Federation of Technical Analysts.