Gold: Drop below 1250 threshold would suggest an extension of the downside to 1228 - Natixis

Micaella Feldstein, Research Analyst at Natixis, presents her view based on the technical analysis on the recent slump in gold prices.

Key Quotes

“The erosion of the 1300-1309 area has triggered a sharp deterioration in the technical pattern; downside parallels have then emerged on the daily chart and the weekly indicators have extended their decline.

Against this backdrop, rallies should be short lived and we recommend being vigilant by keeping a lookout at the 1250 support (weekly Bollinger lower band). A drop below this threshold would suggest an extension of the downside to 1228 (50-week moving average), 1214 (50% Fibonacci retracement of the 1046-1376 / nov 15-july 16) and 1200 (monthly Bollinger moving average). Note that only a return above 1300-1309 would undermine this bearish view.

The resistances are at 1276, at 1287, at 1300-1309 and at 1340.”