After rejecting $1960 resistance level, Gold pushed lower and hit $1850 support area. Gold bulls taking charge above $1850. Will recover higher? What are the charts and technical indicators are saying? Read more to find further insights into today’s XAU/USD Technical Analysis.
September 25, 2020, | AtoZ Markets – Gold is currently trading around $1870 area and trying to climb upside. However, the price is still residing below the dynamic level of 20 EMA on the intraday chart. As per the current price action, the price may face strong resistance at the dynamic level in the coming days.
Gold futures rose Thursday to post its first gain in quite a while. Analysts imposed the ascent to a strike back in the wake of oversold conditions as the U.S. dollar debilitated a bit for the session. However, Gold prices remained forcefully lower week to date as by and large power in the dollar, with the ICE U.S. Dollar Index DXY, – 0.02% climb 1.5% for the week, dulling the interest for the dollar-hight valuable metal. December Gold GCZ20, – 0.10% attached $8.50, or almost 0.5%, to sit at $1,876.90 an ounce.
Gold Bulls Taking Charge as the U.S. Dollar Index Declined
Gold is currently trading around $1870 area and trying to recover higher. After an extended period of volatility inside the ranges of $1900 to $1970 area, Gold bears have successfully broken below and had a daily impulsive close.
Image: Gold 4 Hour Chart
According to the 4-hour chart, Gold bulls are taking charge and currently trading around $1870 area. As per the current price action, if the price can have an impulsive 4-hour bullish candle close above $1875 area, the bulls may recover higher towards $1900 area in the process. Alternatively, if the price climbed higher and rejected by the dynamic level, the bears may regain momentum and push the price downside towards $1800 area in the days ahead.
In addition, the dynamic level of 20 EMA is currently residing above the price. It may work as strong resistance to push the price downward. Besides, the MACD lines are currently residing below the 0.00 level and had a bullish intersection. It indicates that bulls may recover further in the process.
XAU May Revert Back to the Mean
According to the daily chart, Gold bulls are taking charge after bouncing from $1850 area with a bullish pin bar. As per the current price action, if the price can break above the bullish pin bar nose with a daily close, the bulls may retrace higher towards $1900 area in the days ahead. So, if the price retraces towards $1900 area and rejects, the bears may sustain the bearish trend towards $1850 area as a first target. The second target will be $1800 area if the price breaks below $1850 area in the coming days.
Image: Gold Daily Chart
Furthermore, the dynamic level of 20 EMA is currently residing above the price. It may pull the price higher as a mean reversion. Also, the Stochastic Oscillator lines are currently residing near the oversold level 20 and may have a bullish cross over. It indicates that bulls may retrace higher in the coming days.
To conclude, Gold bulls failed to sustain the bullish trend after rejecting $2075 key level last month. A daily close is required to identify the definite momentum in the days ahead.