Gold has become quite volatile and fell below $1700 during the Asian session today. Gold price is consolidating below $1750 area as the fear of COVID-19 rise with the second wave which may harm the commodity again. Can Gold regain its safe-haven reputation again? What are the charts and technical indicators are saying? Read more to find further insights into today’s XAU/USD Technical Analysis.
May 12, 2020 | AtoZ Markets – XAU is currently trading around $1700 area and trying to push higher. Moreover, the price broke below the dynamic level on the intraday chart, but on the daily chart the dynamic level holding the price as support. As per the current scenario, the Gold price may consolidate further before sustain its bullish bias in the coming days.
Gold has beaten by the U.S. dollar as COVID-19 pandemic second wave is knocking on the door. Moreover, XAU has competed with the U.S. dollar over the past two years, whether it was on Coronavirus outbreak, up and down on Wall Street or breakdown in U.S. – China trade effort. On the other hand, Gold futures down by 0.9% at $1699.20 a troy ounce and Sport Gold fell by 0.3% at $1697.20.
Gold Consolidating Below the Psychological Level – Can Bulls Recover Higher?
Gold is currently residing near $1700 area and trying to recover higher. Moreover, the price following the bullish pennant from an extended period, which may break upside in the days ahead.
Image: Gold 4 Hour Chart
According to the 4-hour chart, Gold is currently residing near $1700 area and trying to break above. Moreover, the price violated the dynamic level several times but still have the potential to recover further. As per the current price action, if the price can break above the bullish pennant resistance level. The bulls may push the price higher towards $1750 area. Alternatively, if the price breaks below the bullish pennant support level. The bears may push the price down towards $1650 in the process.
Also, the dynamic level of 20 EMA is currently residing above the price. So, if the price breaks above the dynamic level, the bulls may recover higher. In contrast, if the price finds resistance at the dynamic level, the bears may decline further in the process. Besides, the MACD lines are residing near the 0.00 level and gradually moving upward, which indicates bulls may gain momentum soon.
XAU Bullish Trend to Reach $1800 Area
According to the daily chart, XAU is currently trading around $1700 area and trying to climb higher. Moreover, Gold consolidation below $1750 area from an extended period, but maintain the bullish momentum above $1650. As per the current price action, if the price can have a bullish impulsive close above $1700 area, the bullish trend may sustain towards $1800 in the coming days.
Image: Gold Daily Chart
Furthermore, the dynamic level of 20 EMA is currently residing below the price, which may act as a strong support to push the price higher. Besides, the Stochastic Oscillator lines are residing near mid-level 50 and gradually rising upside. It indicates bulls are still present in the market.
To conclude, as the Coronavirus pandemic push the world economy into uncertainty, investors are worried about the future of commodity like Gold. XAU needs a daily impulsive close above or below $1700 area to find further momentum in the days ahead.