Gold Futures: Room for further retracement

Open interest in gold futures markets increased by nearly 10K contracts on Tuesday, reaching the fourth consecutive daily build according to preliminary readings from CME Group. Volume followed suit and went up by almost 190K contracts, reversing the previous daily drop.

Gold: Initial contention emerges at $1,880

Tuesday’s pullback in gold prices came in tandem with shrinking open interest and volume, indicative that a corrective downside could extend further in the very near term. Against that, the precious metal could extend the drop to the $1,880 region (February 16 high), which should offer initial contention.