Gold price is trading around $1,850, retreating from three-month highs of $1,866, as investors take profits off the table after the recent upsurge. But as FXStreet’s Dhwani Mehta notes, XAU/USD is set to resume the uptrend.
Golden cross remains in play
“The looming geopolitical tensions between Russia and Ukraine will remain the biggest risks for markets, which could potentially keep gold underpinned.”
“Immediate support is seen at $1,846, the 23.6% Fibonacci Retracement level of the rally from January 28 that peaked out last Friday. Further south, the February 10 highs of $1,842 will be tested, below which floors could open up towards 38.2% Fibo level of the same ascent.”
“The correction appears short-lived for gold, as the golden cross remains in play while the 14-day Relative Strength Index (RSI) still holds comfortable above the central line, despite the latest downtick.”
“If buyers regain poise, then a retest of the multi-month highs at $1,866 will be inevitable. The next critical resistance area is seen around $1,870-$1,872 price zone, which is the November peaks.”
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