Pullback from new 7-year high was so far limited as strong fears of coronavirus pandemic persist
Spot gold price dipped on Tuesday after steep, week-long rally hit new 7-year high but showed initial signs of stall on Monday’s daily candle with very long upper shadow, formed after strong upside rejection on approach to psychological $1700 barrier.
Pullback faced headwinds from pivotal support at $1635 (Fibo 38.2% $1547/$1689 upleg / rising 5DMA) and bounced to $1655 zone, despite south-turned daily indicators (bullish momentum is fading; stochastic emerged from overbought territory and overbought RSI reversed).
Holding above $1635 would keep larger bulls intact and near-term focus at immediate targets at $1689/$1700 as traders remain very cautious and ready for fresh safe-haven buying on fears of coronavirus pandemic.
Clear break of $1635 pivot, on the other side, would generate initial reversal signal and open way for deeper correction towards next significant supports at $1618/11 and $1600 in extension.
Res: 1663; 1685; 1689; 1700
Sup: 1649; 1635; 1618; 1611