XAU/USD – At key resistance level
XAU/USD, H4 – Last night, Gold prices rebounded near the key resistance again, creating a high around $1,736. The price raised prior the announcement of US Jobless claims, which came out much higher than the expected at 2,981K from the forecast of 2,500K. That came with a warning of a new outbreak of Covid-19 that may be even more severe than before. However, the US stock market last night all closed up positive, with Dollar firmer.
After the relaxation of the lockdown measures, the short-term economic development trend is not improving, affecting market sentiment along with the fear of a second wave of Covid-19.
From the technical perspective, in the H4-chart, XAUUSD last night broke the upper line of April’s triangle, and as I have already written, the asset has the opportunity to develop a triple top reversal pattern.
By breaking the triangle’s upper line (dotted line) to retest the April 23 high, suggests that if the buying power remains strong , a move above the of the $1,738 – $1,746 area, may be the start of the return to 2012 highs, around $1,800. This may have to wait to see the trend of Covid-19 concurrently. If XAUUSD failed to pass $1,738 – $1,746 Resistance area, then it could find Support back to $1,722. A move further lower could lead gold at the bottom line of the channel, i.e. at $1,710.
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