Gold: On the verge of losing the $1700 level

Gold pulled back on Tuesday as the risk theme turned positive and equities rose. The price moves lower toward $1700, FXStreet’s analyst Rajan Dhall reports.

Key quotes

“The MACD signal lines have crossed over to the downside below the zero mid-line. This is considered bearish in the medium-term and could indicate a bigger correction is in the making. This theory is also backed up by the Relative Strength Index indicator as it is heavily in a bearish position, although there is some more room to move to the downside.” 

“In terms of support zones, the 38.2% Fibonacci support at $1645.00 per troy ounce look firm as it has another support level close by. Bear in mind that if the price does move that low the bull flag would be obsolete and the 200 SMA would be broken.”