Gold Price News and Forecast: XAU/USD licks its wounds below $1840, not out of the woods yet
|Gold Price Analysis: XAU/USD in bearish consolidation below $1840, remains vulnerable
Gold (XAU/USD) is nursing losses in Tuesday’s Asian trading, having slumped 2% on Monday to reach the lowest levels in four months at $1831. The yellow metal fades its recovery attempts above $1840 from multi-month lows, as the bears retain control after the price breached the long-held, critical support at $1850.
The main catalyst behind gold’s breakdown was the unexpectedly strong US Markit Preliminary Manufacturing and Services PMIs for November, which suggested a robust economic recovery from the coronavirus pandemic blow and boosted the US dollar alongside the stocks.
Chart of the Day: Gold
The problem bulls have with gold is that the XAUUSD spot gold market was holding the 1850 support well, until today. Today we closed basically at the 38% retracement of the 2020 lows to 2020 highs. That level came in at the 1838 level and we are now at risk of a move to the 200dma and possibly below in the coming week(s). What looked to be favorable news for gold (Yellen selected as Treasury Secretary by President Elect Biden) late in the session should have given gold a late day rally. Instead it traded heavy and now is at risk of a move lower. RSI is also pointing lower as well. Near term resistance is at the 1870 level.
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