Gold’s Drop Deepens as Bearish Momentum Builds

After weeks of historic strength, Gold has entered a clear bearish phase. The downward pressure began on April 22, and since then, the metal has lost its footing as a top-performing safe haven.

The recent session brought a sharp decline, adding to the growing weakness. Technically, the chart paints a clear story:

• Following the initial drop, Gold entered a pennant formation, marked by converging blue trendlines. This was a flat, corrective pause, common in trending markets.

• As expected in a continuation pattern, the price broke out of the pennant to the downside, confirming the resumption of the bearish trend.

• Adding to the bearish pressure, Gold also broke through a major horizontal support around $3,280-70 per ounce, now marked with a yellow line on the chart.

With the price currently below the broken support and outside the pennant, the technical sentiment is firmly negative. A small bullish correction may occur in the very short term, as sellers take profits and buyers attempt to regain control. But this would likely be a temporary pause before further downside.

The mid-term target now lies at $3,170 per ounce, highlighted with green support – a level that could act as a magnet for price action in the coming sessions.

Unless Gold climbs back above $3,280 quickly and invalidates the breakout, the outlook remains bearish for now.

Source: https://www.axiory.com/analytics/technical-analysis/gold-s-drop-deepens-as-bearish-momentum-builds