Gold is trying to recoup some losses of the preceding week and has been remaining within a downward sloping channel over the last seven months.
In trend indicators, the 20- and 40-day simple moving averages (SMAs) are heading south as well as the Ichimoku lines. The stochastic oscillator is approaching the oversold zone; however, the RSI is turning up in the negative territory, suggesting a possible upside rebound.
An upside pullback could take the market until the next immediate resistance at 1,764 ahead of the 1,817 barrier and near the 20-day SMA. Above these levels, the 40- and 200-day SMAs at 1,832 and 1,860 respectively could come next before resting around 1,875.
Alternatively, a break below the descending channel could move the market until 1,704 and then at 1,668 before hitting the 1,564 support level.
Overall, in the bigger picture, the precious metal has been in a bearish tendency and only an increase above the channel could switch the market to positive.
