In our previously published analysis on Gold we emphasized on the 50% fibb retracement level that if Gold had the capacity to provide us with a bullish closing above in one and four hourly time frame, would be heading next towards 1815-1830. 61.8% fibb is placed at 1824.77 which is our nearby strong resistance and gold will have to build a lot of hawkish momentum to break above, high probability is witnessing a bearish reversal from the aforementioned resistance zone. The bearish pressure in greenback allowed the XAU/USD pair to climb above 1800 at the start of the week. However, the pair struggled to clear the key resistance area that seems to have formed at 1810 mid-week as investors moved to the sidelines while waiting for FOMC Chairman Jerome Powell’s speech at the Jackson Hole Symposium.

BULLISH AND BEARISH CONDITIONS / POSSIBILITIES :

Following Friday's decisive upsurge, the Relative Strength Index (RSI) indicator on the daily chart climbed to 60, suggesting that there is more room on the upside before the pair becomes technically overbought. The initial hurdle is located at 1830 ahead of 1845. On the downside, 1810 exponential moving average 100 and 200 aligns as key support. As long as this level holds, buyers are likely to remain in control of gold's action. A daily close below 1810 could open the door for additional losses toward 1800 (psychological level and 1780. A very important point to note on weekly time frame is that if Gold provided us with a bullish closing above 1834-1840 then it would invalidate the bearish wave count and enter into the continuation of bullish trend again, leading the pair towards 1860 and 1916. A major Non Farm Payroll event is due coming week which will reveal the hand in longer outlooks of the commodity and deterrence of King Dollar. 

XAUUSD

Aug 28 2021

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