Gold Plunges amid Australia’s Inflation News

Gold inched lower on Wednesday, dragging the price of yellow metal to less than $1210 an ounce, following the release of some key economic news. The technical bias remains bearish because of a lower low in the recent downside move.

Technical Analysis

As of this writing, the yellow metal is being traded around $1203 an ounce. A support can be noted near $1171, the trendline support area ahead of $1150-$1156, the confluence of psychological number as well as horizontal support area and then $1133, the lower trendline support zone. The technical bias shall remain bearish as long as the $1337 resistance area is intact.

On the upside, a hurdle can be noted near $1240.58, the horizontal l resistance area  ahead of  $1275, the trendline resistance area and then  $1300, the psychological number as demonstrated in the given above daily chart.

Australia’s Inflation

Australian trimmed mean CPI rose less-than-expected in the last quarter, official data showed on Wednesday. In a report, Reserve Bank of Australia said that Australian trimmed mean CPI rose to a seasonally adjusted 0.4%, from 0.4% in the preceding quarter. Analysts had expected Australian trimmed mean CPI to rise 0.5% in the last quarter.

Trade Idea

Considering the overall technical and fundamental outlook, selling the precious metal around current levels appears to be a good strategy in short to medium term.'
Usman Ahmed

Usman Ahmed is an individual forex trader and market analyst. He holds a Masters of Business Administration (MBA) degree. His work includes fundamental and technical reports on various currency pairs, commodity futures and stock markets. His technical analysis features price action strategies.

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