Article by: ETO Markets

After rising sharply on Tuesday and getting close to the crucial $2,010 resistance zone, spot gold fell down. The fall continued into the American session, suggesting that there could be further downside, if it happens gradually for the time being. There is still bullish potential underneath the yellow metal. US data revealed a drop in both initial and continuing claims as well as a bigger-than-expected dip in durable goods orders in October. 

Technical indicators have shifted south, although XAU/USD is still above an upward trendline on the 4-hour chart. Bearish signs are even being given by the MACD, as the RSI is still declining from over 70. At $…, the 20-SMA has provided support for gold thus far. In order to prevent a more serious deterioration in the outlook, a loss below this level would enhance the negative pressure and expose the $… region as well as a short-term rising trendline that should hold. Another approach to the $… barrier might take place if the price bounces back to $...