April 21, 2021, | AtoZ Markets - Gold is currently trading around $1,782 area and trying to recover further. After breaking below $1,800 to $1,790 support level, the bears pushed the price downside quite impulsively, but failed to sustain the bearish bias below $1,700 to $1,680 area. As per the current price action, the dynamic level of 20 EMA may carry the price as strong support on the intraday chart in the coming days.
Gold Facing Resistance at the Psychological Event Level
Gold is currently residing near $1,782 price area and trying to push higher. Moreover, the Kumo Cloud is also holding the price as a strong resistance on the daily chart.
Image: Gold 4 Hour Chart
According to the 4-hour chart, Gold is facing resistance and currently trading around $1,782 area. As per the current scenario, the price may recover higher towards $1,790 to $1,800 resistance area in the process. So, if the price can break over $1,790 to $1,800 area with an impulsive bullish candle, the bulls may sustain the bullish pressure towards $1,825 to $1,830 area in the coming days. On the contrary, if the price rejects $1,790 to $1,800 area with a 4-hour bearish candle, the bears may regain momentum and push the price downside towards $1,755 to $1,750 area in the days ahead.
In addition, the dynamic level of 20 EMA is currently residing below the price. So, it may work as strong support to push the price higher. Also, the MACD lines are currently residing above the 0.00 level and gradually moving upward. It indicates that the bulls are still holding the bullish momentum.
XAU May Revert Back to the Mean
According to the daily chart, Gold is facing resistance, but the overall bias is still bullish. As per the current price action context, if the price can have a daily bearish candle close below $1,790 to $1,800 area, the price may retrace towards $1,755 to $1,750 area in the coming days. So, if the price retraced towards $1,755 to $1,750 support area and bounced upside with a daily bullish candle, the bulls may sustain the bullish bias towards $1,790 to $1,800 area as a first target. The second target will be $1,825 to $1,830 area if the price can break over $1,790 to $1,800 resistance area in the days ahead.
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 impulsive bullish momentum, the price requires a downside retracement. As the overall bias is still bullish, there is a high chance that XAU/USD may continue the bullish pressure further in the coming days.