On Wednesday, gold held close to 4-1/2-month lows placed in the prior session as financial information from China tempered worries about worldwide development, boosting more dangerous resources.
Spot gold continues to trade at $1,275.96 per ounce since this morning and has fallen as much as 1.2% to $1,272.70, the lowest level since Dec. 27, on Tuesday.
The 100 simple MA sought to extend support during the previous attempt at the beginning of this month. But, the 50 EMA transformed into resistance this month. During the Asian session, gold broke the first support level at $1,285 and the 100 simple MA.
Key Trading Level: 1279.06
In addition to this, the double bottom pattern was also providing strong support around 1,284 but the risk on sentiment has triggered a massive sell-off. Consider taking selling trades below 1,283 with a target of 1,260. By the way, 1,260 isn’t the end of the word, gold prices can drop further towards 1,250. All the best!