Gold Price Analysis: XAU/USD retreats from session highs, eyes 5-day SMA support

Gold has backed off from multi-month highs.
Intraday technical charts favor a pullback to key SMA support.

Omkar Godbole FXStreet Contributor

Gold is trading near $1,952 per ounce, having put in a near two-month high of $1,955 early Wednesday.

The 4-hour chart shows a bearish divergence of the Relative Strength Index (RSI). The hourly chart RSI is also painting a similar picture. Meanwhile, the 14-day RSI is now reporting overbought conditions with an above-70 print for the first time since August.

As such, the yellow metal could visit the ascending 5-day Simple Moving Average (SMA) support, currently located at $1,927.

The case for a pullback would strengthen if the US Republican party wins both seats or at least one in Georgia elections, retaining Senate's control. That would weaken the case for a bigger fiscal stimulus. As such, the dollar, gold's biggest nemesis, could bounce on Republican victory. The dollar index is currently seen at 89.52.

Gold's broader trend would remain bullish as long as prices are trading above Monday's low of $1,898.

Hourly chart

Trend: Pullback likely

Technical levels

XAU/USD

Overview
Today last price	1952.92
Today Daily Change	3.38
Today Daily Change %	0.17
Today daily open	1949.54

Trends
Daily SMA20	1876.65
Daily SMA50	1867.81
Daily SMA100	1893.66
Daily SMA200	1834.82

Levels
Previous Daily High	1953.04
Previous Daily Low	1934.38
Previous Weekly High	1901.02
Previous Weekly Low	1869.32
Previous Monthly High	1906.87
Previous Monthly Low	1775.52
Daily Fibonacci 38.2%	1945.91
Daily Fibonacci 61.8%	1941.51
Daily Pivot Point S1	1938.27
Daily Pivot Point S2	1926.99
Daily Pivot Point S3	1919.61
Daily Pivot Point R1	1956.93
Daily Pivot Point R2	1964.31
Daily Pivot Point R3	1975.59

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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