Gold closed the fourth straight week in negative territory. As FXStreet’s Eren Sengezer notes, XAU/USD looks to test $1,800 with sellers retaining control.
Buyers to remain on the sidelines in the near term
“A prolonged weakening of the dollar doesn’t look likely in the current market environment. The factors that have been driving the greenback’s valuation, namely the ongoing Russia-Ukraine conflict, heightened inflation fears amid lockdowns in China and the Fed’s tightening prospects, should remain intact next week. Hence, it would be reasonable to expect that gold’s recovery attempts are likely to remain limited in the short term.”
“On the upside, the 200-day SMA forms dynamic resistance at $1,840, which could be seen as a recovery target. As long as gold fails to make a daily close above that level, however, the bearish bias should stay intact.”
“$1,800 (psychological level, May 13 low) aligns as first technical support ahead of $1,790 (the beginning point of the February-March uptrend) and $1,780 (January 28 low).”
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