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Gold Technical Forecast: XAU/USD Approaches Key Chart Levels

Gold Technical Forecast: XAU/USD Approaches Key Chart Levels

Thomas Westwater, Analyst

Gold Price Technical Forecast – Neutral

  • XAU/USD remains in a descending channel after failure to breach resistance
  • 1830 and 1850 levels look key for price action in the week ahead
  • 38.2% Fibonacci may provide a base for bulls to retake longer-term trend
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Gold eked out a 0.04% gain in the second week of December as prices rebounded from the psychologically important 1830 level after pitching below 1850 on a rejection from descending channel resistance. Now, XAU/USD approaches longer-term technical levels that may increasingly influence price action in the week ahead.

The most recent move lower followed a late November rally from descending channel support. Gold remains vulnerable to bearish influence within the pattern. Still, Shorter-term momentum appears more neutral with the 20- and 50-day Simple Moving Averages (SMA) moderating, and a neutral ranging RSI. The 1830-1850 range will likely be key levels to break for any directional shifts to occur.

Gold 6- Hour Chart

Gold chart

Chart created with TradingView

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Zooming out to the daily timeframe highlights technical areas beyond the 1830-1850 range. The rising 200-day SMA and inflection from the 1808-1824 range may offer a degree of confluent support to stifle any short-term selling pressure. A break lower, however, will look for a test of trendline support formed from the 2020 lows before November’s multi-month swing low (1764.73) comes into view.

Conversely, the 38.2% Fibonacci retracement of the March-August move appears to be providing the most immediate support. A move higher will aim to break through descending channel resistance that would signal a shift back to gold’s longer-term bullish trend. Overall, the near-term and approaching technical levels could provide traders actionable movement, but the 1830 and 1850 price levels look key before moving further.

Gold Daily Chart

Gold Daily Chart

Chart created with TradingView

XAU/USD TRADING RESOURCES

--- Written by Thomas Westwater, Analyst for DailyFX.com

To contact Thomas, use the comments section below or @FxWestwater on Twitter

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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