Gold Price Analysis: XAU/USD due for a breakout, according to key indicator

Gold remains stuck in a four-week-long descending triangle.
A widely-tracked momentum indicator is teasing a bullish revival.

Omkar Godbole FXStreet Contributor

Gold's multi-week consolidation in a narrowing price range could end with a bullish breakout, as a widely-tracked daily chart indicator is about to turn bullish.

The yellow metal has carved out a descending triangle pattern over the past four weeks. The triangle's upper end or resistance is currently located at $1,960, and support is seen at $1,910. Gold is trading at $1,953 per ounce at press time, representing a 0.13% gain on the day.

The daily chart MACD histogram, an indicator used to gauge trend strength and trend reversal, is printing higher lows below the zero line, a sign of weakening of the bearish momentum. Besides, the indicator now looks set to cross into bullish territory above zero.

As such, gold could soon take out the triangle resistance at $1,960. That would open the doors for $2,015 (Aug. 18 high).

Daily chart

Trend: Bullish above $1,960

Technical levels

XAU/USD

Overview
Today last price	1953.27
Today Daily Change	2.72
Today Daily Change %	0.14
Today daily open	1950.55

Trends
Daily SMA20	1945.37
Daily SMA50	1935.06
Daily SMA100	1836.48
Daily SMA200	1714.71

Levels
Previous Daily High	1960.16
Previous Daily Low	1943.09
Previous Weekly High	1973.64
Previous Weekly Low	1932.88
Previous Monthly High	2075.32
Previous Monthly Low	1863.24
Daily Fibonacci 38.2%	1953.64
Daily Fibonacci 61.8%	1949.61
Daily Pivot Point S1	1942.37
Daily Pivot Point S2	1934.2
Daily Pivot Point S3	1925.3
Daily Pivot Point R1	1959.44
Daily Pivot Point R2	1968.34
Daily Pivot Point R3	1976.51

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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