The precious metal posted solid declines last week as price fell to a two-month low near 1850.
Gold prices managed to pullback into Friday’s close. The breakdown comes after the support area near the 1911 – 1900 region gave way.
In the near term, a pullback could see gold retesting this level for resistance. If resistance near here holds, we could expect further declines.
Below the 1850 handle, gold prices would be looking at the 1817 level of support next.
For the moment, however, the bullish divergence on the Stochastics indicates that a short term correction to the upside is on the cards.