09.09 - GOLD was seen oscillating through the European session on Wednesday
- by George Solotarov
Gold lacked any firm directional bias and remained confined in a narrow trading band, around the $1930 region through the early European session. Having found a decent support near the $1906 region, around 50-day SMA, the precious staged a goodish bounce on Tuesday from two-week lows and finally settled nearly unchanged for the day. The recovery was triggered by the global flight to safety amid a major selloff in the US equity markets.
From a technical perspective, Tuesday's downfall confirmed a near-term breakdown below a symmetrical triangle. That said, the lack of follow-through selling below the 50-day SMA warrants some caution for bearish traders and positioning for any further near-term depreciating move. On the other hand, bulls might still need to wait for a sustained strength beyond the $1940-45 supply zone in order to confirm that the commodity might have formed a strong base and placing fresh bets.