Gold prices continue to decline as the US-China trade deal boosts risk appetite

Gold prices tumbled on Wednesday, breaching key support levels as optimism surrounding the US-China trade agreement reduced fears of a broader economic crisis, overshadowing safe-haven demand.

Renewed risk appetite drove gold below pivotal levels at \$3,228 (50% Fibonacci retracement of the \$2,956/\$3,500 rally), which previously withstood several downside attempts, and the critical psychological mark at \$3,200 (the base of the pullback from the new record high).

A sustained break below \$3,200 would confirm a bearish failure swing pattern, signaling the potential for a deeper correction from the \$3,500 peak.

Technical indicators on the daily chart are deteriorating, with 14-day momentum diving further into negative territory, while prices have slipped below the 10, 20, and 30-day moving averages, which have also formed bearish crossovers.

However, the oversold stochastic suggests the possibility of increased support at the \$3,200 level, potentially leading to a consolidation phase in the near term.

To maintain bearish pressure, gold should remain capped below the broken \$3,228 Fibonacci level, with any upside moves ideally staying limited below Tuesday and Wednesday’s highs at \$3,265 and \$3,257, respectively.

Res: 3200; 3228; 3265; 3292
Sup: 3164; 3126; 3100; 3084