Gold looks like it will experience weakness in the near term as it enters a seasonally weak period from end of May to June and has broken below several key technical areas:
- Lower bound of long-term ascending channel from mid-2018
- Lower bound of the triangle formed in mid-April
- $1,725 support level
Currently the price appears to be trading a newly formed descending channel and finding support at $1,710. I do not expect this level to hold and price will trend downward within the channel to the other end of the triangle at the $1,700 range.
Heading into June, I expect some mean reversion toward the 50 DMA currently at $1,675 and perhaps down to the 100 DMA at $1,631. There will be support at the rising trend from May 2019 before the breakout from $1,350 last summer.
- Lower bound of long-term ascending channel from mid-2018
- Lower bound of the triangle formed in mid-April
- $1,725 support level
Currently the price appears to be trading a newly formed descending channel and finding support at $1,710. I do not expect this level to hold and price will trend downward within the channel to the other end of the triangle at the $1,700 range.
Heading into June, I expect some mean reversion toward the 50 DMA currently at $1,675 and perhaps down to the 100 DMA at $1,631. There will be support at the rising trend from May 2019 before the breakout from $1,350 last summer.