Gold Price Analysis: XAU/USD hovers near $1,900, daily chart shows bearish pattern
|- Gold's daily chart shows a descending triangle breakdown.
- Key indicators have aligned in favor of the bears.
The path of least resistance for gold appears to be on the downside, as the yellow metal's daily chart shows a bearish pattern, and the US dollar is breaking higher from its multi-week trading range.
The metal closed Tuesday with a 0.66% loss at $1,899 per ounce, confirming a downside break of a descending triangle represented by trendline connecting Aug. 18 and Sept. 1 highs and Aug. 26 and Sept. 8 lows.
The triangle breakdown indicates the four-week price consolidation has ended, and the pullback from the Aug. 7 record high of $2,075 has resumed.
The breakdown is backed by a below-50 or bearish reading on the 14-day relative strength index and descending 5- and 10-day simple moving averages.
The MACD histogram is again printing deeper bars below the zero line – a sign of the strengthening of the bearish momentum.
As such, the metal risks falling to the Aug. 12 low of $1,863. A close above the descending 10-day SMA, currently at $1,936, is needed to invalidate the bearish view.
Daily chart
Trend: Bearish
Technical levels
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