Gold Price Forecast: XAU/USD testing support at $1,800 after rejection at $1,830
- Gold retreats from $1,835 to test support at the $1,800 area.
- A moderate risk appetite is weighing on demand for the precious metal.
- XAU/USD, approaching the apex of an ascending triangle pattern.
Gold futures are testing support at the $1,800 mark on Wednesday’s European session, after pulling back from Tuesday’s high at $1,833. Bullion prices have been treading water above $1,825 for the last two weeks, following a 12% rally from mid-November lows near $1,600.
Gold loses ground amid a moderate risk appetite
The precious metal has been trading lower on Tuesday, giving away gains after a spike high to $1,835 seen on Tuesday. The moderately positive market mood, triggered by news that China is scrapping quarantine for inbound travelers has lifted the market mood in an otherwise quiet post-Christmas market.
Furthermore, the US Dollar remains on the back foot, with the Dollar Index trading 0.2% lower on daily charts and moving right above the 104.00 level, following a moderately positive opening, which pushed the DXY to session highs at 104.35.
XAU/USD moving in an ascending triangle pattern
From a technical perspective, the daily chart shows the pair approaching the apex of an ascending triangle pattern, limited by a resistance area at $1,825, and trendline support from late-November lows, now around $1,795.
With the MACD indicator in negative territory, a confirmation below the mentioned $1,795 would negate the uptrend and boost sellers' confidence to push the pair towards $1,765/75, the December 6 and 15 lows and the November 23 low at $1720.
On the contrary, a run-up above the $1,825/35 resistance area would confirm the bullish pattern and set the pair aiming to June high at $1,880 before the $1,900 psychological level.
XAU/USD daily chart
Technical levels to watch
Author
Guillermo Alcala
FXStreet
Graduated in Communication Sciences at the Universidad del Pais Vasco and Universiteit van Amsterdam, Guillermo has been working as financial news editor and copywriter in diverse Forex-related firms, like FXStreet and Kantox.
