Mr. Tejas Anil Shigrekar, Commodities and Currencies Senior Technical Analyst, Angel One Ltd
The short-term bearish trend is projected to revert into neutral or bullish territory. We need to keep a close eye on important support levels of 59500. As long as the price of MCX GOLD continues to be significantly below 59770, short trades could be advantageous.
On a Technical basis, currently, the RSI (14) is below 70, indicating that it is in an overbought zone, with negative divergence. Prices are trading above their 50-day exponential moving average (EMA). However, when we look at the longer timeframe on the chart and use the Fibonacci retracement tool, prices hold support near the 78.60% fib ratio and likely form a double bottom pattern, indicating that the prices will revert in the short run. Keeping this support level in mind, trend traders should not hesitate to buy gold at this level.