Gold Price Analysis: XAU/USD heads back towards key $1828 support ahead of Powell

Gold’s rebound loses steam below $1850, bears take over.
Rising channel breakdown on 1H chart points to more losses.
A breach of key $1828 support remains likely ahead of Powell.

Dhwani Mehta FXStreet

Gold (XAU/USD) remains vulnerable to deeper losses, as the US Treasury yields and the dollar continue to cheer the prospects of a bigger-than-expected fiscal stimulus plan, of about $2 trillion, likely to be announced by President-elect Joe Biden on Friday. Ahead of that, the Fed Chair Powell's speech will hold the key for fresh gold trades.

At the time of writing, gold trades at $1841, down 0.46% on the day, as the recovery ran into stiff offers just below the $1850 level.

Gold Price Chart: Hourly

The downside bias in gold remains intact, especially after the price confirmed a rising channel breakdown on the hourly chart on Biden’s expected stimulus news.

The bearish crossover of the 21-hourly moving average (HMA) and 50-HMA added credence to the selling bias. The metal breached the pattern support, now at $1853, and spiraled down to hit daily lows at $1828.54.

Ever since the bulls are trying hard to stage a comeback but in vain, as the Relative Strength Index (RSI) points south below the midline while holding well above the oversold territory. The RSI is currently seen at 36.10.

The recovery attempts are capped below the pattern support now resistance at $1847. The next relevant hurdle awaits at the bearish 21-HMA at $1849. The 50-HMA at $1853 could offer further resistance.

Alternatively, the sellers could retest the daily lows, below which the January 11 low of $1817 would be on their radars.

Gold Additional levels

XAU/USD

Overview
Today last price	1841.03
Today Daily Change	-7.61
Today Daily Change %	-0.41
Today daily open	1848.84

Trends
Daily SMA20	1885.13
Daily SMA50	1865.8
Daily SMA100	1889.68
Daily SMA200	1842.43

Levels
Previous Daily High	1863.15
Previous Daily Low	1845.84
Previous Weekly High	1959.42
Previous Weekly Low	1828.27
Previous Monthly High	1906.87
Previous Monthly Low	1775.52
Daily Fibonacci 38.2%	1852.45
Daily Fibonacci 61.8%	1856.54
Daily Pivot Point S1	1842.07
Daily Pivot Point S2	1835.3
Daily Pivot Point S3	1824.76
Daily Pivot Point R1	1859.38
Daily Pivot Point R2	1869.92
Daily Pivot Point R3	1876.69

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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