Gold Price Analysis: XAU/USD climbs to $1,750, forming a rising wedge

Gold's 15-minute chart shows a rising wedge pattern.
A breakdown would open the doors to a re-test of Tuesday's low.

Omkar Godbole FXStreet Contributor

Gold's recovery from Tuesday's low of $1,726 to $1,750 has taken the shape of a rising wedge pattern on the 15-minute chart.

A rising wedge comprises converging trendlines connecting higher highs and higher lows. The converging nature of trendlines is indicative of buyer exhaustion. Hence, a breakdown is considered a sign of trend change and often leads a price drop to the apex or starting point of the wedge.

At press time, gold is trading at $1,748 per ounce and the support of the rising wedge is located at $1,743. A breakdown, if confirmed, would open the doors to a re-test of $1,726. Alternatively, acceptance above $1,750 would shift the focus to the recent highs near $1,765.

A bullish scenario looks likely as Tuesday's green candle engulfed the body of Monday's inverted bearish hammer candle, weakening the case for an extended pullback.

XAU/USD 15-min chart

Trend: Bearish below $1,743

Technical levels

1. R3 1775.42
2. R2 1761.72
3. R1 1753.37
PP 1739.67
1. S1 1731.32
2. S2 1717.62
3. S3 1709.27

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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