Gold, Chart of the Week: XAU/USD bears eye a run to test $1,970

As per the prior week´s pre-open analysis, Gold,of the Week: XAU/USD bulls remain in control, where the Weekly chart´s W-formation had seen the Gold price duck towards the neckline, a bullish phase was anticipated as follows:

... we got a move into resistance as the ongoing analysis showed:

•    Gold Price Forecast: XAU/USD bears lurking as right shoulder forming

As illustrated above and below, it was then explained that we could have a topping pattern in place for the Gold price:

Gold price H4 chart, prior analysis

The Gold price had slid to the backside of the trendline support and a break of the neckline horizontal support of the Gold price Head & Shoulders pattern is still needed to switch the bias fully negative from out of the consolidation:

Gold, live updates

(weekly chart)

(Daily chart)

(H4 chart)

We now have gold meeting support and the price is correcting. So long as the Gold price stays on the front side of the bearish trendline,  the correction is going to struggle to maintain momentum and $1,970 will be eyed as the next key target for the bears. 

From a fundamental perspective, analysts at TD Securities explained that continued hawkish talk from the US FOMC members and unexpectedly firm economic data have convinced traders that the US central bank may not pivot to a dovish policy stance anytime soon.

´´With yields moving higher across the yield curve and a firmer dollar, many managers went short; this turned out to be the correct call as the yellow metal is some $66 off the $2,048/oz high at the time of writing,´´ the analysts explained.

´´Given US economic data continues to come in strong with the Fed likely hiking rates in May, prices may still drop further to support levels near $1,962/oz. This would be in line with our Q2 forecast of $1,975/oz,´´ the analysts concluded.