Currently, gold (XAU/USD) is trading at $1327, having left higher low along the upward sloping 50-day MA last week.
The metal is up 1.52 percent from last week's low of $1307.05, but bull market revival is still not confirmed, indicates technical chart.
The above chart shows-
- The metal has been trapped in a rising channel and has tested the head and shoulders neckline (now acting as resistance). Also, we see that descending trendline is intact and could cap upside in the metal around $1334 levels.
- The momentum studies favor the bears as shown by bearish 50-MA and 200-MA crossover and downward sloping 100-MA
- Meanwhile, the RSI is biased bullish.
A daily close above $1334 (falling trendline resistance) would add credence to the rebound from upward sloping 50-day MA and open doors for re-test of the recent high of $1366 levels.
However, as seen on the chart above, the momentum studies are biased bearish, and the metal is yet to take out the head and shoulders neckline (now acting as resistance) in a convincing manner. Hence, as of now, a close above $1334 looks difficult.
Bearish scenario - Downside break of the rising channel would add credence to bearish 50-MA and 200-MA cross and yield a drop to $1307.05 (last week's low) and $1300 levels.
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