Gold Price Forecast: XAU/USD cheers dollar dumping, closes in on $2000

Gold (XAU/USD) hit the highest levels in two weeks near the $1990 mark, as the bulls remain unstoppable, courtesy of the relentless declines in the US dollar across its main competitors. The yieldless gold continues to benefit from expectations of a low-interest-rate environment for a prolonged period in the aftermath of the Fed Chair Powell’s speech. The yellow metal finally dived out of the eight-day-long range above the $1977 hurdle, as it looks to regain the $2000 threshold.

The bullish tone in gold is also backed by the weak performance in the Asian equities following a softer close on Wall Street overnight. The continued rise in the coronavirus cases globally overwhelm the markets. Looking ahead, only a better-than-expected US ISM Manufacturing PMI and Employment sub-index could come to the rescue of the dollar bulls,

Gold: Hourly chart

Short-term technical perspective  

On the hourly chart, Gold has displayed a pennant breakout, having closed the hour above the falling trendline (pattern) resistance at $1972.

The bullish breakout triggered a sharp rally towards the $1990 mark, especially after the price pierced above the 21-hourly Simple Moving Average (SMA), then at $1967.50.

Gold now looks to test the pattern target at $1994 en route the critical hurdle at $2000.

The hourly Relative Strength Index (RSI) has reversed from the overbought territory, still remains bullish near the 68 area.

The pattern resistance now support at $1972 will act as the immediate support, below which the $1970 level could be challenged. That level is the confluence of the 21-HMA and the pattern support.

Should the selling pressure accelerate the upward-sloping 50-HMA at $1964 could come into play.

Gold: Additional levels to consider