Gold has become corrective and currently facing resistance around $1,915 to $1,900 area. Gold dropped below $1,900 significant event area. Will the bears push the price lower 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.
June 2, 2021, | AtoZ Markets – Gold is currently trading around $1,895 area and trying to push downside. After bouncing from $1,850 to $1,860 support level, the bulls have regained momentum and climbed over $1,900 to $1,915 area. However, the bulls failed to hold the bullish momentum above $1,900 to $1,915 psychological event area. As per the current price action, the price may face strong support at the uptrend line on the intraday chart in the coming days.
Gold Dropped Below as the Price Faced Strong Resistance
XAU is currently residing near $1,895 area and trying to decline. However, the price also broke below the dynamic level of 20 EMA on the intraday chart.
Image: Gold 4 Hour Chart
According to the 4-hour chart, Gold dropped below and currently trading around $1,895 area. As per the current price action, if the price can break below the uptrend line support with an impulsive 4-hour bearish candle close, the bears may regain momentum and push the price downside towards $1,860 to $1,850 area in the coming days.
In addition, the dynamic level of 20 EMA is currently residing above the price. So, it may work as strong resistance to push the price downward in the process. Moreover, the MACD lines are currently residing above the 0.00 level and created a bearish divergence. It indicates that the bears may regain momentum for a while in the days ahead.
XAU May Retrace Downside
According to the daily chart, Gold dropped below as the price requires a downward retracement. As per the current price action, the price may retrace down towards $1,860 to $1,850 support area in the process. So, if the price retraced towards $1,860 to $1,850 support level and bounced upside with an impulsive daily bullish candle, the bulls may sustain the bullish trend towards $1,900 to $1,915 area as a first target. The second target will be $1,950 to $1,960 key area if the price can break above $1,900 to $1,915 resistance area in the coming days.
Image: Gold Daily Chart
Furthermore, the dynamic level of 20 EMA is currently residing below the price. Along with the Kijun line. So, the dynamic level may pull the price down as a mean reversion. Besides, the Kijun line may work as a confluence of the dynamic level in the days ahead.
To conclude, as long as the price residing over the dynamic level of 20 EMA and the Kijun line, the bias will remain bullish. Therefore, there is a high chance that the Gold may continue further higher after a downside retracement in the coming days.