Gold bulls are on edge despite rising hopes for a rate cut on September 18, 2024 - a date millions will be closely watching as the Fed announces its decision.
Analyzing recent movements in gold futures, it's clear that the market could open the week with a gap-down, and the current weakness may persist until the Fed's final decision.
Last Friday's steep decline in gold futures suggests that this downward trend could continue into this week.
On the 1-hour chart, gold futures show a strong potential for further decline. A bearish crossover has formed, with the 9 DMA and 18 DMA both dipping below the 50 DMA, indicating continued pressure.
In the 4-hour chart, gold futures failed to hold above the key resistance level at $2,561, resulting in a bearish hammer formation.
The daily chart also shows a bearish candle formed last Friday, which still requires confirmation in the first trading session of the upcoming week.
On the weekly chart, the formation of a bearish hammer last week signals the likelihood of a selling spree in the weeks ahead.
However, gold bulls might make another attempt to test the immediate resistance at $2,561 before the downward trend resumes, as bears remain in control with bulls still in the overbought territory.
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