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SINGAPORE, Aug 15 Spot gold is biased to retest a support $1,784 per ounce, a break below which may cause a fall into a range of $1,767-$1,773.
Signals are a bit mixed, as the metal is consolidating within a range of $1,784-$1,801. This consolidation may be shaped into a top pattern, in consideration of the lasting gains from the July 21 low of $1,680.25.
The bearish divergence on RSI supports a drop rather than a rise. A break above $1,801 could signal the continuation of the uptrend towards a zone of $1,812-$1,821.
On the daily chart, gold is struggling around a falling trendline and a strong resistance at $1,801. Given that the rise from $1,680.25 has not been disrupted by a decent correction, gold is more likely to drop towards $1,755 than to rise towards $1,831.
A break below $1,779 could basically confirm a reversal of the uptrend, while a break above $1,801 may lead to a gain to $1,831.
(Wang Tao is a Reuters market analyst for commodities and energy technicals. The views expressed are his own.
No information in this analysis should be considered as being business, financial or legal advice. Each reader should consult his or her own professional or other advisers for business, financial or legal advice regarding the products mentioned in the analyses.)
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