Gold has become volatile after the price dropped below the $1950 area last week. At the moment, XAU/USD price is below the $1950 area. Will the pair decline further? Read on to find further insights into today’s XAU/USD Technical Analysis.
August 24, 2020, | AtoZ Markets – Gold price fell today against the U.S. Dollar during the Asian session. After hitting the $2000 resistance level, the bears regained momentum and push the price down quite aggressively. Gold is currently trading around $1930 and trying to push downside. As per the current price action, the price may face strong support around the $1900 area in the coming days.
Gold Price Sustains Below the Psychological Level $1950
XAU is currently trading around $1930 area and trying to push lower. Moreover, the price broke below the dynamic level of 20 EMA on the intraday chart.
Image: Gold 4 Hour Chart
According to the 4-hour chart, Gold sustains the price below $1950 area and currently trading around $1930 area. As per the current price action, if the price can have an impulsive bearish candle close below the $1930 area, the bears may decline further towards the $1900 area in the coming days. Alternatively, if the price pushes higher and breaks above $1950 area with an impulsive bullish candle, the bulls may recover higher towards $2000 area in the days ahead.
In addition, the dynamic level of 20 EMA is currently residing above the price. Along with the Kijun line and the Tenkan line. The dynamic level may act as strong resistance to push the price downside. Besides, the Kijun line and the Tenkan line may work as a confluence of the dynamic level in the process. In contrast, the bulls may regain momentum if the price breaks above the dynamic level.
XAUUSD Bears May Continue the Bearish Pressure
According to the daily chart, Gold sustains the price below the dynamic level of 20 EMA with an impulsive bearish daily candle close. As per the current price action, if the price breaks below $1900 area with a daily bearish candle, the bears may sustain the price towards $1800 area in the days ahead.
On the contrary, if the price reaches the $1900 area and bounces higher, the bulls may regain momentum and recover higher towards the $2000 area as a first target. The second target will be $2070 if the price breaks above $2000 area in the coming days.
Image: Gold Daily Chart
Furthermore, the dynamic level of 20 EMA is currently residing above the price. It may act as strong resistance to push the price downside in the process. Besides, the RSI line is currently residing below the overbought level 70 and gradually sloping downward. It indicates that bears may continue the bearish bias in the coming days.
To conclude, after gaining a massive amount of pips, there is a high chance that XAU may retrace further downward. A daily close is required to identify the definite momentum in the coming days.