Gold Price News and Forecast: XAU/USD - The bulls may be starting to grow concerned

London (Jan 22)  According to flash data from CME Group for Gold futures markets, traders added 886 contracts to their open interest positions on Tuesday, recording the second – albeit small – build in a row. Volume, too, rose for another session, this time by around 229.5K contracts.

The ounce troy of Gold keeps correcting lower on Wednesday following Tuesday’s pullback against the backdrop of increasing open interest and volume. With this in mind, the $1,536/32 band could be revisited in the near-term horizon, where coincide last week’s low and a Fibo retracement of the December rally.

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Gold: the bulls may be starting to grow concerned

Following yesterday’s failed upside break, the bulls may be starting to grow concerned. This failed breakout has also now turned lower this morning, and the support of what has been a five week uptrend is being tested (supports at $1548 today). For now, this is all part of a consolidation of the past two weeks, and uptrends can often be broken by consolidation without any bearish connotations. So the 38.2% Fibonacci retracement again becomes a key gauge (at $1548), especially on a closing basis. However, the momentum indicators are flashing at least an amber warning light. They are all dipping back again, and if the RSI moves decisively below 60, whilst Stochastics fall away and MACD lines pick up negative pace, this would be a bigger concern.

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