Long-Term Trend Support Framework
The 200-day average represents the low end of the target range. This is because strong support was seen near the average during the March spike low and that it aligns with the large rising channel formation. The rising midline of the channel represents a harmonic relationship to the boundaries of the formation, and the 200-day line is not far from this midline, with both converging eventually.
Bearish Confirmation Across Indicators
In addition to the bearish wedge signal that triggered recently, the decline has broken back below all major moving averages after a short recovery attempt. It has also pushed gold back below the top boundary of the trend channel. The combination of bearish signals strongly suggests that lower levels may be tested before the decline finds sustained support. This suggests interim rallies are likely to encounter resistance when testing prior support zones. The 20-day moving average at $4,773 presents a key resistance zone on a bounce as it has clearly been recognized as both support and resistance recently.
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