Spot Gold Technical Analysis: Short-term May Test $4,240 Support Level

1. From a technical perspective, spot gold may further decline in the short term, with the target pointing to the support level at $4,240 per ounce. If this level is effectively breached, it may further open up the possibility of a drop to $4,133. 2. Applying Fibonacci retracement analysis to the upward movement since the low of $3,959, the gold price has already fallen below the 50% retracement level at $4,328, confirming the extension of the downtrend. The next key support is located near the 61.8% retracement level at $4,240.3. Projection analysis of the decline since the $4,630 high yields a similar conclusion—the target range lies between $4,145 and $4,175, which is formed by the 361.8% and 338.2% Fibonacci projection levels. 4. The resistance zone above is situated between $4,310 and $4,330. If the gold price breaks above this area, a rebound may be triggered, with further upward targets in the $4,361 to $4,393 range.5. On the daily chart, analyzing the retracement of the decline since the $4,889 high, the 23.6% retracement level points to $4,166. The current gold price has roughly broken below the 38.2% retracement level at $4,307, indicating that bearish momentum still dominates. 6. Overall, the rebound from the $3,943 low has failed to break above the key resistance level at $4,764—this position marks the 50% retracement level of the downtrend from the $5,596 high. Therefore, the current decline is more likely considered an extension of the larger-scale downtrend rather than simply a corrective pullback.