Gold Price Analysis: XAU/USD eyes $1850 amid bull pennant breakout on 1H chart

Gold extends recovery for the second straight session.
Bull pennant breakout confirmed on the hourly chart.
Hourly RSI peeps into the overbought territory.

Dhwani Mehta FXStreet

Gold’s recovery from five-month lows of $1765 gains further traction on Wednesday, as the bulls gear up for a test of the earlier critical support now resistance at $1850.

The technical set up favors the bulls, as the price confirmed a bull pennant breakout on the hourly chart in the last hour. The validation came in after the metal gave an hourly closing above the falling trendline resistance at $1815.

The price pierced above the 200-hourly moving average (HMA) at $1819, offering extra zest to the XAU bulls after the big breakout.

The hourly Relative Strength Index (RSI) marches into the overbought territory, currently at 74.05, implying that the price could reverse to test the 200-HMA before resuming its upward journey towards the $1850 level.

A breach of the 200-HMA could expose the pattern resistance now support at $1815. The next downside target for the bears is seen at the bullish 21-HMA at $1812.

The recovery momentum remains intact so long as the precious metal holds above the $1800 level.

Gold Price Chart: Hourly

Gold: Additional levels

XAU/USD

Overview
Today last price	1824.48
Today Daily Change	9.67
Today Daily Change %	0.53
Today daily open	1814.51

Trends
Daily SMA20	1859.5
Daily SMA50	1881.1
Daily SMA100	1910.09
Daily SMA200	1800.64

Levels
Previous Daily High	1817.37
Previous Daily Low	1775.52
Previous Weekly High	1876.14
Previous Weekly Low	1774.4
Previous Monthly High	1965.58
Previous Monthly Low	1764.6
Daily Fibonacci 38.2%	1801.38
Daily Fibonacci 61.8%	1791.51
Daily Pivot Point S1	1787.56
Daily Pivot Point S2	1760.62
Daily Pivot Point S3	1745.71
Daily Pivot Point R1	1829.41
Daily Pivot Point R2	1844.32
Daily Pivot Point R3	1871.26

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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