Gold Futures: Further downside appears limited

Open interest in gold futures markets reversed the recent uptrend and shrank by around 3.5K contracts on Tuesday according to preliminary readings from CME Group. Volume followed suit and dropped for the second consecutive session, now by nearly 2K contracts.

Gold: Immediately to the upside comes $1930

Tuesday’s drop in gold prices was amidst shrinking open interest and volume, which is indicative that a deeper pullback appears out of favour in the very near term. That said, the resumption of the upside bias could see the recent top around $1930 per ounce troy revisited.