Gold erodes weekly gains on buoyant Dollar

The bullion continues to pare the rally, which took place throughout the previous week amid dovish policy decisions of the Fed. Now the Greenback is back on track, meaning gold is now attracting the bears that are likely to attempt penetrating the long-term uptrend at 1,245. A drop under here would confirm the rising wedge pattern and it will considerably worsen our future outlook for the metal. The following support is the 20-day SMA at 1,240; however, it is not backed by any other demand level for now. Most probably, the target will quickly switch to a dense cluster of supports just above 1,200. 

 

During the past 72 hours of the weekend, only one percent of SWFX market participants decided to return to the bullish camp. For now the longs' market share is just 31%.