GOLD – Extended Pullback Tests Daily Cloud Base Support

Gold remains under strong selling pressure, extending its steep post-election downtrend to a two-month low on Thursday.

Reduced political uncertainty in the US and rising expectations that Trump’s economic policies will significantly stimulate growth have been the primary factors driving gold’s decline over the past week. Additionally, anticipated inflationary measures are likely to push the Fed to adopt a less aggressive stance on rate adjustments in the near term. However, markets continue to overlook gold’s role as an inflation hedge, keeping the metal on a downward path.

The pullback from the recent all-time high of $2790 has now retraced 50% of the $2293/$2790 rally and has moved through the thick daily Ichimoku cloud, currently near its base at $2524, though it is now encountering resistance.

Key levels to watch are the $2542/$2524 support zone (100DMA and daily cloud base) and the $2600 area (the broken 38.2% Fibonacci retracement and cloud top), as a break on either side could set the next directional signal for gold.

Res: 2581; 2600; 2618; 2643
Sup: 2542; 2524; 2500; 2483