- Gold surges after a descending triangle breakout on the 4H chart.
- 200-SMA challenges bull’s commitment above $1850.
- Markets await the Fed and a likely US fiscal stimulus deal.
Gold (XAU/USD) consolidates Tuesday’s surge, trading close to the weekly tops just below the $1860 barrier.
The yellow metal rallied nearly 1% a day before and now looks to build on the upside amid rising expectations that the US lawmakers will clinch the much-awaited coronavirus relief aid package.
However, the XAU bulls remain mindful of the Fed decision due later on Wednesday, with likely upbeat projections from the American central bank seen hurting the sentiment around gold.
From a technical perspective, the four-hour (4H) chart shows that gold is struggling to recapture the horizontal 200-simple moving average (SMA) at $1859.
Acceptance above the latter could prompt the bulls to resume its upbeat momentum, in the wake of a descending triangle breakout confirmed early Tuesday.
Gold Price Chart: Four-hour
The next relevant resistance is seen at $1875, the December 8 high. The bulls could then eye a test of the $1900 mark.
The Relative Strength Index (RSI) sits beneath the overbought territory, near 67.00, suggesting that there is scope for further upside.
On the flip side, the horizontal 50-SMA at $1845 could be back on the sellers’ radars. That level was the previous crucial resistance.
Further south, the 21-SMA support at $1840 could likely be probed.
Gold Additional levels
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