Gold edged higher during the early part of the trading on Monday, though the intraday uptick lacked follow-through buying or strong bullish conviction. There seems to be no end in sight to the ongoing war in Ukraine, which rejected Russia's calls to surrender the port city of Mariupol. The worsening geopolitical landscape kept investors on the edge and extended some support to the safe-haven precious metal. That said, the emergence of some US dollar buying acted as a headwind for the dollar-denominated commodity.

Gold (XAU/USD) prices cross the 50% Fibonacci retracement (Fibo.) of January-March upside amid steady RSI and lackluster MACD signals of late.

Given the quote’s latest sidelined performance between the 100 and 200 SMA, respectively around $1,952 and $1,905, the metal’s latest run-up aims at the upper limit of the stated range i.e. near $1,952.

However, a horizontal area from late February will challenge the XAU/USD’s further upside around $1,977-80.

On the contrary, a downside break of the 200-SMA level surrounding $1,905 will need validation from the $1,900 threshold.

Also challenging the gold sellers is the 61.8% Fibo. level near $1,890 and February 24’s swing low surrounding $1,879.

As observed on the daily chart, with the 14-day Relative Strength Index (RSI) defending the midline, gold price also managed to hold above the one-month-old rising trendline support, now at $1,917. If the recovery momentum extends, then gold bulls will need a daily closing above the upward-sloping 21-Daily Moving Average (DMA) at $1,943 to flex their muscles.

Further up, the $1,950 supply zone could be challenged en-route the previous year’s high of $1,960. The February highs of $1,975 will be next on buyers’ radars.

On the downside, if the above-mentioned critical support line is taken out on a daily closing basis, then a test of the March lows of $1,901 will be inevitable. The next strong support zone is seen near $1,880, which is the confluence of the February 24 low and ascending 50-DMA.

50% Fibo Zone to Provide Support for Recovery

Mar 21 2022

Take Profit +4.05%

Holding time 14d2hr

1900.00

Entry price

1977.00

Take profit price