Gold Price Technical Analysis: XAU/USD prepares for a yielding week after rebounding from critical support
|- Gold is testing a critical resistance level, likely to culminate in massive liftoff past 2,000.
- The bullish outlook will be sabotaged if XAU/USD closes the day under the descending parallel channel’s middle boundary.
Gold has recently embraced formidable support, slightly at 1,760 following a considerable downfall from the seller congestion at 1,950. The world’s most precious metal closed the week slightly under 1,850. The market will experience a massive recovery price action, especially if XAU/USD makes a daily close above 1,950.
Gold gets ready for an extensive upswing
XAU/USD is holding within a descending parallel channel. The lower boundary played a crucial role in shaping the current recovery. Gold seems to be trading at the middle boundary. If this level is flipped into support, the price will embark on a journey of breaking barriers.
On the other hand, some delay is expected at the 50 Simple Moving Average and the 100 SMA. However, a breakout past the channel’s upper boundary will catapult Gold to price levels around 2,050. The bullish outlook will be validated by the Relative Strength Index break above the descending trendline, a move that may call for more buy orders.
XAU/USD daily chart
It is worth noting that Gold’s massive uptrend will be invalidated if the price failed to hold above the middle boundary of the channel. Moreover, if losses stretch under the 200 SMA, XAU/USD might continue with the four-month downtrend.
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