Despite heightened tensions between the U.S. and China, the three major U.S. stock indices pared early losses to close with modest gains last Friday. Spot gold climbed 0.4% on day but still below its April-high, raising doubts over a false upside breakout seen last week.

Today, the U.S. equity markets are closed to observe the Memorial Day and the U.K. markets are closed for the Spring Bank Holiday. While a relatively quiet trading session may be expected, a lack of more powerful triggering events might continue to put pressure on gold.

From a technical point of view, spot gold remains on the downside as shown on the 1-hour chart. It has created another lower-high and is heading downward to test its previous low. The level at $1,740 may be considered as the nearest resistance, while a break below the nearest support at $1,721 (where a longer-term raising trend line is located) would be a more bearish signal, and possibly suggesting that the next support at $1,703 is exposed. Alternatively, a break above $1,740 would trigger a re-test to the previous high at $1,754.

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DISCLAIMER: The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase of sale of any currency. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

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