Correction in Gold unfolding, potential down to 2,200

Gold (XAUUSD) is back below key support at 2,319 after failing to close above 2,350, which would have confirmed the resumption of an uptrend. If Gold breaks below 2,291, it is likely to face a sell-off down to between 2,260 and 2,255, and possibly even lower to around 2,207, which is the 0.786 retracement of the leg up since March.

The strength indicator RSI has been showing divergence for quite some time, a sign of trend exhaustion. A correction is needed. However, if Gold jumps back to close above 2,352, this likely bearish scenario would be negated, potentially reversing to an uptrend with a target of 2,400.