Gold Continues its Fall and Accents Losses Below $1,800

Gold has started the week with losses after falling below $1,800 on Friday. Last week, it accumulated a 1.3% fall, which led the metal to suffer its worst decline since March this year with a collapse of 4.49%.

So far into Monday’s session, gold is already racking up around 0.25% with XAU/USD moving at $1,782.73. However, a glimmer of hope hangs over the gold bulls as today is the last day of November. This month has seen considerable gains in the stock market and a strong asset flight in gold. So, profit-taking that raises gold, at least momentarily, can occur.

In this environment, analysts around the world are beginning to question the upward trend in gold. Especially since there is an absence of possible fiscal stimulus in the United States, as researchers and experts at TD Securities point out.

According to analysts, the price of gold at the moment is totally inconsistent with what is happening in other markets. And this is telling us that it’s overwhelmingly driven by positioning shifts. Most likely, gold prices have passed some threshold that was essentially the maximum pain that some market participants could bear.

With no stimulus yet in sight, the big question for gold is whether the market can count on the Fed to do more in December. More specifically, in the change of the weighted average maturity that some part of the market expects. That was the central theme of the Fed’s minutes and will likely be the central theme of the mid-December FOMC meeting. That is ultimately what will determine whether or not gold prices will resume their upward trajectory in the near future.

The next support is located at $1,750

As we mentioned earlier, gold fell unsteadily. Moreover, it has already passed two critical levels for the bullish bias of the metal.

On November 23, the XAU/USD dropped below $1,846.55, support that had been operating since mid-July. Likewise, on November 27, the metal broke the $1,800 lower, a level that it had been testing throughout the previous week.

In that environment, the XAU/USD fell to $1,774.40 last Friday, its lowest level since July 7 this year.

According to the analysts, the next support is located at $1,750. It seems that it will be a matter of time to test it, as the indicators are strongly bearish and the metal broke below the 200-day moving average last week.