Gold Price Analysis: XAU/USD bulls eye $1940 despite overbought conditions
|- Gold is off weekly tops but holds gains above $1930.
- Overbought conditions on the 4H chart warrant caution for the bulls.
- $1940 and $1950 still remain on the buyers’ radars.
Gold (XAU/USD) holds the higher ground near eight-day tops of $1935, as the bulls gather pace for the next push to the upside.
As observed in the four-hour chart, gold confirmed a symmetrical triangle breakout on the final trading day of the year 2020.
Gold Price Chart: Four-hour
The bulls built onto Thursday’s upside break, extending the upbeat momentum into the first trading day of 2021.
The precious metal has rallied as much as $20 so far, with room for additional upside despite the Relative Strength Index (RSI) trending in the overbought zone, at the momentum.
The measured pattern target is aligned at $1940, above which the $1950 psychological barrier could come into the picture.
Alternatively, the confluence of the 21-simple moving average (SMA) and pattern resistance at $1893 will act as strong support.
The next relevant downside barrier is seen at $1883, the intersection of the 50-SMA and pattern support.
Gold Additional levels
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.