Article by: ETO Markets

Given the lowering geopolitical tensions between Israel and Hamas and the pre-US CPI data-driven cautious trade, the gold price is expected to continue its downward trajectory. The Israeli military announced on Monday that it had completed a "series of strikes" on southern Gaza, which it stated had "ended," following the rejection of a Hamas ceasefire proposal by Israeli Prime Minister Benjamin Netanyahu. However, speeches made by Fed policymakers will draw some attention before the crucial US inflation report for January, since they may signal a dovish turn from the Fed.

The price of gold is hinting at a potential downward breach of the $… rising trendline support. Should the daily candlestick close below that threshold, there will be a new decline towards the $… barrier. The $… round number will test bullish pledges prior to then. For buyers of gold, the advancing 100-DMA around $… represents their last line of defense.

The 20- and 50-DMAs Bear Cross are still in effect in the interim.  Conversely, on an early rebound, gold buyers will test the $… supply zone if the trendline support at $… holds.