This week, Gold slipped to * multi-week low eyeing * test of well-known technical levels. Where could XAU/USD rebound?
Gold Technical Analysis
XAU/USD trend changes from neutral to bearish
Bearish momentum may accelerate below $1,861
Bulls Pullback
On September 16, Goldrallied to an over two-week high at $1,973 then retreated after as bulls seemed to cut back. Ultimately, * weekly candlestick closed with * Doji pattern highlighting the market indecision. The Relative Strength Index (RSI) remained flat then crossed below 50 on Monday signaling * possible start of bearish momentum.
Gold Daily Price Chart (August 6 – September 23, 2020)
On Monday, Gold slipped by 1.7% and closed below the 50-day moving average. The precious metal moved to the lower trading zone $1,861- $1,921 eyeing * test of the low end of it.
* daily close below the low end of the zone could encourage bears to press towards the monthly support at $1,796 (Oct 2012 high).
On the other hand, * failure to close below the low end of the zone at $1,861 could reverse the current direction towards the high end of the zone.
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Chart source, Webtrader, Capex.***
Last week, Goldtraded below the bullish trendline support originated from the Sep 8 low at $1,906 and started * downward trend creating lower highs with lower lows.
To conclude, while the negative bias is still in place * break below $1,847 could send XAU/USD towards $1,818 while * break above $1,944 may trigger * rally towards $1,966. As such, the support and resistance levels underscored on the chart should be mon