Gold Price Analysis: XAU/USD's daily chart shows temporary uptrend exhaustion
|- Gold's daily chart shows a bearish divergence of the MACD, a sign of uptrend exhaustion.
- A break below the 10-day SMA could prove costly.
Gold is sidelined around $1,809 per ounce at press time with the daily chart MACD histogram, an indicator used to identify trend changes and trend strength, reporting a bearish divergence.
A bearish divergence occurs when an indicator prints a lower high, contradicting a higher high on price and is reflective of buyer exhaustion.
As such, the metal looks vulnerable to price pullback. Moreover, the bearish divergence of the MACD would remain valid as long as prices are held below the recent high of $1,818.
The immediate support is seen at $1,795 (10-day simple moving average). Acceptance under that support line could cause some buyers to exit the market, leading to a deeper pullback. This is because sellers have failed multiple times to establish a strong foothold below the 10-day simple moving average in the last four weeks.
On the higher side, $1,818 is the level to beat for the bulls.
Daily chart
Trend: Buyer exhaustion
Technical levels
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.