Gold drops $20 to a two-week low

Technical Analysis

Author: Adam Button | gold

What's next for gold

What's next for gold
Gold is near the lows of the day, down $20 to $1712.

What's especially worrisome for gold bulls today is that the decline comes with the US dollar broadly weaker. That means that gold has fallen further in other currency terms.

The bull case for gold is debt monetization and ultra-low (or negative) rates. That isn't going to change but there's also a safety bid and it looks less compelling with economies re-opening and the S&P 500 rising above the 200-day moving average.

Technically, the drop to a two-week low today is a setback as the break from the consolidation period in April-May  appears to have run out of gas. However this could simply be a retest of that range before a push higher.

The key area of support is $1700 and it would take a break below there to truly rattle the bulls.

See here for global coronavirus case data
By continuing to browse our site you agree to our use of cookies, revised Privacy Notice and Terms of Service. More information about cookiesClose