Gold Price Analysis: XAU/USD eyes $1900, head-and-shoulders in play
- Gold remains vulnerable amid bearish technical set up.
- The price teases head-and-shoulders on the hourly chart.
- Bearish hourly RSI, not yet in the oversold territory.
Gold (XAU/USD) saw some aggressive selling in the last hour and revisited daily lows near $1925 region, courtesy of the fresh leg higher in the US dollar.
The greenback caught a fresh bid-wave across the board after the major central banks announced that they would scale back dollar repos as coronavirus pandemic-led market tensions ease.
Looking at gold, technically, the price has charted a potential head-and-shoulders formation on the hourly chart, with an hourly close below the neck line at $1924 to validate the bearish pattern.
The yellow metal is primed for a fresh sell-off should the bulls fail to defend the $1924 barrier. The next cushion is seen at $1900, below which the three-week lows of $1863 will come into play.
The hourly Relative Strength Index (RSI) remains bearish but just above the oversold territory, suggesting more room to the downside.
Any recovery attempts will meet stiff resistance at the downward-sloping 21-hourly Simple Moving Average (HMA) at $1949.
Acceptance above the latter will call for a test of the immediate hurdle around $1970 region (horizontal 100 and 200-HMAs) while the buyers could target the 50-HMA resistance at $1978 thereon.
Gold: Hourly chart
Gold Additional levels
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.
