GOLD – bears dominate while the price holds below falling thick daily cloud

Gold price fell at the start of the week, losing around 1.8% by mid-European trading on Monday, reflecting growing concerns about rising inflation that prompted major central banks to take more hawkish stance, despite that all of them kept rates unchanged in the policy meetings last week.

On the other hand, high geopolitical uncertainty surrounding the latest signals about possible escalation over the Strait of Hormuz, partially counters the action and provides headwinds for fresh bears.

Technical picture on daily chart remains bearishly aligned after recent recovery attempts were capped just under the base of thick descending daily Ichimoku cloud, with Friday’s Doji and today’s large bearish candle, about to complete reversal pattern.

Converging daily Tenkan/Kijun-sen are about to form a bear cross and along with strengthening negative momentum and DMAs in full bearish setup, contribute to negative near-term outlook.

Bears pressure pivotal $4500 support zone, consisting of last Wednesday’s one-month low and Fibo 50% retracement of $4099/$4899, violation of which to further weaken near-term structure and expose targets at $4401 (Fibo 61.8%) and $4285 (200DMA / Fibo 76.4%) in extension.

Initial resistance lays at $4587 (broken Fibo 38.2%), followed by $4631/41 (daily Kijun-sen / Tenkan-sen respectively) and key obstacle at $4665 (daily cloud base).

Res: 4587; 4641; 4700; 4740
Sup: 4510; 4494; 4401; 4351