Gold has become impulsive and non-volatile after breaking $1,850 to $1,860 resistance area. Gold climbed over $1,900 psychological event area. The bulls to continue the bullish trend further in the coming days? What are the charts and technical indicators are saying? Read more to find further insights into today’s XAU/USD Technical Analysis.
May 26, 2021, | AtoZ Markets – Gold price rose today morning during the Asian session against the U.S. Dollar. XAU is currently trading around $1,910 area and trying to recover further. After bouncing from $1,800 to $1,810 support level, the bulls pushed the price higher quite impulsively and reached January 2021’s high. As per the current price action context, the price may revert back to the mean on the daily chart in the coming days.
Gold Climbed Over as the Investors Are Optimistic
XAU is currently residing near $1,910 price area and trying to climb further. However, the bulls have gained almost 1,000 pips after bouncing from $1,800 to $1,810 support level.
Image: Gold 4 Hour Chart
According to the 4-hour chart, Gold climbed over and currently trading around $1,910 price area. As per the current price action, the price may retrace downside towards $1,900 to $1,890 support area in the coming days. So, if the price retraced towards $1,900 to $1,890 support level and bounced higher with an impulsive bullish candle, the bulls may sustain the bullish bias towards $1,940 to $1,950 key area in the process.
In addition, the dynamic level of 20 EMA is currently residing below the price. So, it may carry the price as strong support in the days ahead. Moreover, the Stochastic Oscillator lines are currently residing above the overbought level 80 and had a bearish crossover. It indicates that the price may retrace lower in the process.
XAU May Revert Back to the Mean
According to the daily chart, Gold climbed over as the overall momentum is bullish. As per the current price action context, if the price can have an impulsive daily bearish candle close below $1,900 to $1,890 area, the price may retrace downside towards $1,860 to $1,850 support area in the coming days. So, if the price retraced towards $1,860 to $1,850 support area and bounced higher with an impulsive bullish candle, the bulls may continue the bullish trend towards $1,890 to $1,900 area as a first target. The second target will be $1,940 to $1,950 key area.
Image: Gold Daily Chart
Furthermore, the dynamic level of 20 EMA is currently residing below the price. Along with the Kijun line and the Tenkan line. So, the dynamic level may pull the price downside as a mean reversion. Besides, the Kijun line and the Tenkan line may work as a confluence of the dynamic level in the process.
To conclude, after an extended period of bullish momentum, the price requires a downside retracement. A daily close will help to identify the definite momentum in the coming days.