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Gold Dives In Near Term, Bullish In Medium-Term

Gold prices have been in a descending movement over the last couple of sessions, drifting below the 20-day simple moving average (SMA) and the 50.0% Fibonacci retracement level of the down leg from 2,074.89 to 1,676 at 1,875.

Looking at the momentum indicators, the stochastic oscillator posted a bearish crossover within the %K and %D lines, while the RSI is diving into the negative territory. Moreover, the MACD is slipping beneath its trigger line, remaining in the positive region.

In case the bears drive the market beneath the 1,855 support and the bullish crossover within the 40- and 100-day SMAs, the 38.2% Fibonacci retracement level of 1,826 may halt the declining move. Steeper decreases could open the door for the 1,800 handle ahead of the 23.6% Fibonacci of 1,768.

On the other side, a successful attempt beyond the 50.0% Fibo of 1,875 would take the market towards the 1,918-1,919 resistance area, which encapsulates the 61.8% Fibonacci. Any advances above this barrier could send the bulls until 1,965, endorsing the medium-term upside structure.

To sum up, the yellow metal is in a sideways bias in the very short-term, however, the rebound off 1,676 keeps the medium-term outlook to bullish.

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