Gold Price Analysis: Probing inverse head-and-shoulders neckline hurdle

Gold's 4-hour chart shows an inverse head-and-shoulders pattern.
A breakout would open the doors to a re-test of Nov. 9 highs.

Omkar Godbole FXStreet Contributor

Gold is currently trading near a key hurdle, which, if breached, could bring a stronger rally.

The yellow metal is flirting with resistance at $1,866 - the neckline of the inverse head-and-shoulders pattern. Acceptance above would confirm a breakout or bearish-to-bullish trend change and create room for a rally to $1,966 (target as per the measured move method). On the way higher, the metal may face resistance at $1,900.

A strong rejection at the neckline hurdle would shift risk in favor of a drop to $1,820 (4-hour chart support).

Fundamental factors such as the Federal Reserve's bond purchases, the record global stockpile of negative-yielding bonds, and weak dollar support the bullish case.

4-hour chart

Trend: Bullish

Technical levels

XAU/USD

Overview
Today last price	1865.12
Today Daily Change	0.72
Today Daily Change %	0.04
Today daily open	1864.4

Trends
Daily SMA20	1834.01
Daily SMA50	1872.34
Daily SMA100	1907.01
Daily SMA200	1812.05

Levels
Previous Daily High	1865.78
Previous Daily Low	1844.88
Previous Weekly High	1875.34
Previous Weekly Low	1822.22
Previous Monthly High	1965.58
Previous Monthly Low	1764.6
Daily Fibonacci 38.2%	1857.8
Daily Fibonacci 61.8%	1852.86
Daily Pivot Point S1	1850.93
Daily Pivot Point S2	1837.45
Daily Pivot Point S3	1830.03
Daily Pivot Point R1	1871.83
Daily Pivot Point R2	1879.25
Daily Pivot Point R3	1892.73

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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