Gold is trading around $4,129, pulling back after hitting strong resistance around 4,157 during Tuesday's US trading session.
Gold was unable to break above the 21-day SMA and encountered strong resistance around this level. We are now seeing a technical correction that could continue to consolidate around the 61.8% Fibonacci retracement level.
From its low of $4,073 to its high of $4,205, gold completed a technical correction to the 61.8% Fibonacci level, so it may be setting the stage for a new bullish scenario; however, we should wait for the price to consolidate above $4,160 before expecting it to reach 2/ 8 Murray level around 4,218 and could ultimately encounter strong resistance around $4,223.
If gold falls below $4,115, we could expect the downtrend to continue, potentially reaching the 0/8 Murray level around $4,060; and if bearish momentum prevails, it could even reach the psychological level of $4,000.
Given that gold formed a GPA on September 23 around 4,279, a consolidation above $4,222 could be seen as a positive signal to continue buying, with targets around $4,296—approximately the 3/8 Murray level.
