- Gold witnessed some follow-through selling for the second consecutive session on Friday.
- Technical indicators on daily charts support prospects for a further near-term decline.
Gold remained depressed through the first half of the European session, albeit has managed to recover a part of its intraday losses to eight-month lows. The precious metal was is trading near the $1,764 region.
From a technical perspective, November 2020 low region, $1,764 support to the XAU/USD. That said, on 4-hourly/daily charts trend is holding in the bearish territory as price is forming Higher Lows and Lower Lows. Technical indicators are still far from being in the oversold zone. This, in turn, favours bearish traders and supports prospects for further weakness.
However, any subsequent slide is more likely to find some support near a short-term descending trend-line, currently around the $1,750 region. Bearish traders could wait for a sustained break through the mentioned support before placing fresh bets. The XAU/USD might then accelerate the fall further towards the $1,725-24 support en-route the $1,700 round-figure mark.
On the flip side, immediate resistance is near the daily high region. A sustained strength beyond might push the XAU/USD back towards the descending trend-line resistance, around the $1,810 area, which if cleared will negate any near-term bearish bias.
