Support Zones for Bulls
That is the first line of defense for the bulls. However, since gold had advanced by a healthy 11.4% advance when measured from the most recent swing low to this week’s high. A deeper pullback would not be unwarranted and may better build momentum for another leg up. Recent bullish signals now provide potential support area below the initial Fibonacci retracement. The lower swing high near $4,203 is key since a rise above it triggered a reversal of the downtrend structure.
Deeper Levels Remain in Play
The 61.8% retracement is at $4,167. Along with the rising 20-day moving average at $4,175 and the 50-day moving average at $4,146, further validate potential support in that area. The relationships to the 50-day moving average is key since it was confirmed several times as resistance since March. At the same time, if it is reached, the chance for a bullish recovery strengthens. For now, the potential upside remains near the 200-day moving average at $4,506.
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