Gold Price Analysis: XAU/USD closed week with small losses near $1,730
|- Risk-averse market environment helped gold find demand on Friday.
- The daily RSI suggests that bullish momentum is building up.
The XAU/USD pair closed the first three days of the week in the negative territory and lost nearly 1.5% during that period. After touching its lowest level in two weeks at $1,694 on Wednesday, the pair reversed its direction and staged a decisive rebound in the second half of the week to close near $1,730.
The risk-off market environment amid worries over escalating US-China geopolitical tensions helped gold find demand as a safe-haven.
Technical outlook
The Relative Strength Index (RSI) indicator on gold's daily chart started to edge higher toward 60 to suggest that buyers are starting to take control of the price action. Moreover, XAU/USD closed above the 20-day SMA after breaking below that line in mid-week.
On the upside, $1,735/40 area (static level) aligns as the initial resistance. With a daily close above that area, gold could target $1,755 (May 20 high) and $1,765 (multi-year high). Supports could be seen at $1,720 (20-day SMA), $1,700 (psychological level) and $1,685 (50-day SMA).
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