Gold cleared the critical support at 1850 yesterday. The market opened at 1853; the price rebounded to the day-high at 1865 during the European session. Selling resumed once the market entered the US session, and the price has gone all the way to the day-low at 1835 after it crossed the key support of 1850. The day finally ended at 1837, down by USD 15.

Gold failed to break out from the downward trendline(2) yesterday, leading the price to slide below 1850. The selling momentum wasn’t strong as it broke through the critical support of 1850; an S-T rebound may happen in the next 24-48 hours. While the price is now supporting at 1835, continue to keep an eye on the trendline(2). If the price escapes the selling pressure from the trendline(2), expect the price to rebound toward 1890, the upper limit of a wider downtrend channel(3). On the other hand, if the selling continues, the next downside target will be around the 1825-20 level.

Expect the selling to continue after gold broke the key 1850 support on the daily chart. The target can be set at 1800 if the price clears the current 250 days of MA support.

S-T Resistances:

1850

1845

1840

Market price: 1837

S-T Supports:

1835

1825-28

1820

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