Wedge Breakdown Triggers Broader Weakness
The breakdown from the wedge formation that triggered a week ago Tuesday also broke below several key trend indicators that gold had been recently attempting to reclaim, including the 10-day, 20-day, and 100-day moving averages and the top boundary of a long-term rising trend channel. Given the confluence of resistance near the top of the channel and subsequent weakening, further downside suggests a lower target near the midline of the channel. A little lower than that is the 200-day moving average at $4,283. It represents the lower end of the potential support range along with an internal uptrend line. Recently, the two trend indicators have been aligned, indicating a more significant dynamic support zone.
Long-Term Support Framework Remains Intact
The sharp decline in March bounced off support near the 200-day moving average, establishing a new higher swing low at $4,099. That was the first time it was touched since November 2023, and the sharp bullish response confirmed it as a key long-term trend indicator. The top of the potential support zone begins near the February spike low of $4,402 and goes to the 200-day line.
Bearish Context Remains Dominant Despite Bounce
Overall, while short-term bounces are emerging, price action remains anchored below key broken trend indicators. This keeps the broader focus on whether rallies into resistance continue to attract selling pressure within the ongoing corrective structure.
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