Gold prices had the worst decline in seven weeks following early estimates that political novice Emmanuel Macron and far-right populist Marine Le Pen are headed for a run-off after the first round France Presidential elections. The results were well received by Wall Street as risk assets surged. The euro rallied over a percent and so did the major US indexes. The worst case scenario of match between Le Pen and communist-back Jean Luc Melenchon was avoided. The runoff election will now take place on May 7th.
Price action on the gold daily chart shows that price continues to respect the bearish Gartley pattern on April 17th. Point D was confirmed just ahead of the 70.7% Fibonacci retracement level of the X to A leg and the 141.4% Fibonacci expansion level of the B to C leg. If the bearish move continues, key support may come from the 200-day SMA, which currently trades at the $1,258.90. Deeper support may come from the $1,200 to $1,210 region. To the upside, major resistance remains the psychological $1,300.00 level.The trade: Sell Gold at $1,285 with a stop loss at $1,295 and a take profit at $1,255. The Risk/Reward Ratio is 1:3