XAU/USD technical analysis: Gold needs a break above the $1,298 resistance for more gains

Gold price traded higher recently and broke the $1,295 resistance zone against the US Dollar. The price traded close to the $1,300 level before sellers appeared near the $1,297 and $1,298 resistance levels.

A high was formed near $1,297 on FXOpen and later the price declined below $1,295. Sellers pushed the price below the 50% Fib retracement level of the last leg from the $1,280 low to $1,297 high. However, the decline found a strong support near the $1,286 level.

Besides, the 61.8% Fib retracement level of the last leg from the $1,280 low to $1,297 high also acted as a support. The price bounced back above $1,290 and the 50 hourly simple moving average.

Gold

The current price action is positive and it seems like there could be more gains above the $1,292 and $1,295 resistance levels. However, a proper break above the $1,298 resistance is needed for more gains in the near term.

On the downside, an initial support is at $1,290, followed $1,288. Moreover, there is a major bullish trend line in place with support at $1,282 on the hourly chart of gold. Overall, dips remain supported in gold and the price may soon trade towards $1,298.

RISK WARNING: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 78% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. Professional clients can lose more than they deposit. All trading involves risk.