FX.co ★ GOLD Price Analysis for 2nd March, 2021

• Gold staged a modest intraday bounce from multi-month lows amid a softer risk tone.
• Slightly oversold conditions extended some support to the safe-haven commodity.
• The attempted recovery might still be seen as an opportunity for bearish traders.

Gold managed to recover the early lost to fresh nine-month lows and struggles to retain the rebound from the start of the week as longer-dated US Treasury yields hold above pre-pandemic levels, and looming developments in the Relative Strength Index (RSI) may indicate a further decline in gold prices as the indicator flirts with oversold territory for the first time since November.

From a technical perspective, oversold conditions on short-term charts seemed to be the only factor that assisted the XAU/USD to find some support near the $1,707 region. That said, the bias remains tiled in favour of bearish traders and supports prospects for further weakness.

The overnight rejection near the $1,760-65 support-turned-resistance and the lack of any meaningful buying interest adds to the negative outlook. Hence, any further recovery might still be seen as a correction and opportunity to initiate fresh bearish positions around the XAU/USD.

From current levels, immediate resistance is near the $1,760 region. This is followed by the $1,810, which should cap any further upside.On the flip side, weakness back below the $1,710 immediate support will reaffirm the bearish bias and accelerate the fall towards the $1,700 mark. The downward trajectory could eventually drag GOLD further to the next major support near the $1,675-70 region.