Gold Bears has regained momentum after hitting a record high of $2070 key area. Gold faced strong resistance around $2070 area and pushed downward. Will bears decline further? What are the charts and technical indicators are saying? Read more to find further insights into today’s XAU/USD Technical Analysis.
August 10, 2020, | AtoZ Markets – Gold is currently trading around $2030 area and trying to decline further. The price broke below the dynamic level of 20 EMA on the intraday chart. As per the current price action context, XAU may retrace down towards the 2011’s key level in the coming days.
Since the beginning of 2020, gold has been on an upside direction. However, on August 9, the Gold traders encountered the biggest daily fall of the valuable metal in two months. Gold lost 2%, and the U.S. dollar recaptured an upside momentum on a superior-than-anticipated recuperation in the U.S. employment report that was published recently.
Gold Faced Resistance as the U.S. Dollar Gained Momentum
XAU is currently residing near $2030 area and trying to push downside. Moreover, the price also broke below the Kijun line and the Tenkan line on the 1-hour chart.
Image: Gold 4 Hour Chart
According to the 4-hour chart, Gold faced resistance around $2070 resistance level and currently residing near $2030 area. As per the current price action, if the price can have an impulsive 4-hour bearish close below $2035 area, the bears may sustain the bearish pressure towards $2000 in the days ahead. Alternatively, if the price breaks above $2035 area with an impulsive 4-hour bullish candle, the bulls may regain momentum and recover higher towards $2070 area again in the process.
In addition, the dynamic level of 20 EMA is currently residing above the price. Along with the Tenkan line. The dynamic level may work as strong resistance to push the price down in the coming days. The Tenkan line may work as a confluence of the dynamic level. However, the Kijun line is still residing below the price, which may act as strong support in the process.
XAU May Revert Back to the Mean
According to the daily chart, Gold faced resistance as the U.S. Dollar gained momentum. As per the current scenario, if the price can have a daily bearish candle close below the previous daily candle’s close, the bears may push the price downside towards $2000 area. Besides, if the price can break below $2000 area with an impulsive bearish candle, the bears may decline towards $1950 key support area in the coming days. In the contrary, if the price reaches $2000 area and bounces higher with a daily bullish close, the bulls may regain momentum and recover higher towards $2070 area again the days ahead.
Image: Gold Daily Chart
Along with this, the dynamic level of 20 EMA is currently residing far below the price. It may pull the price down as a mean reversion. Also, the MACD lines are currently residing above 0.00 level and may have a bearish cross over. Moreover, the RSI line is currently residing above the overbought level 70 and gradually sloping down. Both indicators are indicating that bears may sustain the bearish pressure further in the days ahead.
To conclude, Gold has gained a tremendous amount of pips in just a few weeks as the U.S. economy is facing a hard time because of the Coronavirus pandemic. A daily close is required to identify the definite momentum in the coming days.