Gold Price Analysis: XAU/USD remains vulnerable, break below 200-DMA in play

Gold struggled to gain any traction and remained depressed near multi-month lows.
Bearish flag breakdown supports prospects for an extension of the recent downtrend.
Any meaningful recovery attempt might be seen as an opportunity for bearish traders.
Gold has dropped sharply below $1,800, breaking below the 200-DMA

Haresh Menghani FXStreet

Update: XAU/USD tumbled down to a fresh low of $1,774 at the time of writing, amid cascading stops, breaking below the 200-DMA. See:

Gold traded with a mild negative bias through the mid-European session and was last seen hovering near the lower end of its daily range, around the $1805 region.

The XAU/USD now seems to have found acceptance below a three-day-old ascending trend-channel, which constituted the formation of a bearish flag on short-term charts. Bearish technical indicators on hourly/daily charts add credence to the negative set-up and support prospects for an extension of the recent downward trajectory.

That said, bearish traders might still wait for some follow-through selling below the very important 200-day SMA, around the $1800 mark, before placing fresh bets. The XAU/USD might then accelerate the downward trajectory towards the $1763 region – support marked by the 50% Fibonacci level of the $1451-$2075 strong move up.

On the flip side, any meaningful recovery attempt might be seen as a selling opportunity and runs the risk of fizzling out rather quickly near the $1818-20 region. This is closely followed by the trend-channel resistance, around the $1822 level, which if cleared decisively might trigger some near-term short-covering move.

Some follow-through buying has the potential to lift the commodity further towards the 38.2% Fibo. level resistance near the $1835 region, which should cap any further upside.

XAU/USD 1-hourly chart

Technical levels to watch

XAU/USD

Overview
Today last price	1807.54
Today Daily Change	-1.56
Today Daily Change %	-0.09
Today daily open	1809.1

Trends
Daily SMA20	1874.6
Daily SMA50	1888.79
Daily SMA100	1910.41
Daily SMA200	1798.36

Levels
Previous Daily High	1818.36
Previous Daily Low	1804.92
Previous Weekly High	1899.14
Previous Weekly Low	1852.8
Previous Monthly High	1933.3
Previous Monthly Low	1860
Daily Fibonacci 38.2%	1813.23
Daily Fibonacci 61.8%	1810.05
Daily Pivot Point S1	1803.23
Daily Pivot Point S2	1797.35
Daily Pivot Point S3	1789.79
Daily Pivot Point R1	1816.67
Daily Pivot Point R2	1824.23
Daily Pivot Point R3	1830.11

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

Editor's Picks

EUR/USD posts modest gains above 1.1700 as ECB signals pause

The EUR/USD pair posts modest gains around 1.1710 during the early Asian session on Monday. The Euro strengthens against the Greenback after the European Central Bank left its policy rates unchanged and took a more positive view on the Eurozone economy, which has shown resilience to global trade shocks. Financial markets are likely to remain subdued as traders book profits ahead of the long holiday period.

GBP/USD gains ground near 1.3400 ahead of UK Q3 GDP data

GBP/USD gains ground after three days of losses, trading around 1.3390 during the Asian hours on Monday. The pair depreciates as the Pound Sterling holds ground ahead of the release of the United Kingdom Gross Domestic Product for the third quarter.

Gold sits at record high near $4,400 amid renewed geopolitical woes

Gold is sitting near $4,400 early Monday, renewing lifetime highs, helped by renewed geopolitical tensions. Israel-Iran conflict and US-Venezuela headlines drive investors toward the traditional store of value, Gold.

Top Crypto Gainers: Audiera, Midnight, MemeCore sustain weekend gains

Audiera, Midnight, and MemeCore recorded double-digit gains on Sunday and remain top performers over the last 24 hours. Audiera extends the rally while Midnight takes a breather, and MemeCore struggles at a crucial moving average.

De-dollarisation by design: Gold’s partner in the new system

You don’t need another 2008 for the system to reset. You just need enough nations to stop settling trade in dollars. And that’s already happening. "If gold is the anchor, what actually moves value in a post-dollar world?” It’s a question most gold investors overlook. We think in terms of storage and preservation, but in the new rails being built, settlement speed matters just as much as soundness of money.

XRP rebounds amid ETF inflows and declining retail demand demand

XRP rebounds as bulls target a short-term breakout above $2.00 on Friday. XRP ETFs record the highest inflow since December 8, signaling growing institutional appetite.