Gold testing important uptrend line


It looks like the recent surge in gold prices might be over as there is some notable weakness in precious metals on Wednesday.

At the time of writing, the bullion was testing the short-term uptrend line, which is currently near 1,985 USD. This is a trendline from lows after the recent sharp sell-off, therefore, it is crucial. If the price declines below this trend line, it might tell us that the rally from 1,880 USD to 2,020 USD was only a correction of the huge sell-off and the price might start going lower again. Therefore, bulls need to defend this trend line. 

So, if gold drops below 1,980 - 1,985 USD, the next level to watch could be at 1,960 USD and afterward at around 1,930 USD. As previously discussed, failure to stay above the trendline could mean the medium-term uptrend might be nearing its end. 

Alternatively, if the price starts to rally again, the resistance seems to be at around 2,000 USD and afterward near 2,015 USD. 

The greenback is still under pressure, which should benefit the metals. 
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