Gold Technical Analysis: Oversold conditions warrant some consolidation before the next leg of a downfall to $1275 level

   •  The precious metal extended its intraday rejection slide from the $1300 neighbourhood and tumbled to fresh multi-week lows during the early European session on Monday.

   •  Friday's sustained bearish break below 50-day SMA - for the first time since Nov. 2018, was seen as a key trigger behind a follow-through selling for the fourth straight session.

   •  The commodity has now dropped to 38.2% Fibo. level of the $1200-$1346 recent upsurge, also coinciding with a congestion zone held during the early part of January.

   •  Meanwhile, oscillators on the daily chart have just started gaining negative momentum and are still far from oversold territory, clearly pointing to an extension of the bearish trajectory.

   •  However, technical indicators on hourly charts are already pointing to highly oversold conditions and warrant some consolidation before any further near-term depreciating move. 

Gold daily chart