Gold Technical Analysis: DXY recovery favors contracting triangle breakdown

Omkar Godbole FXStreet Contributor

The 13-day-long contracting triangle seen in gold's 4-hour price chart is more likely to be breached to the downside, courtesy of the recovery rally in the US dollar - gold's biggest nemesis.

As of writing, gold is trading at $1,292 per Oz, having clocked a high of $1,295 earlier today. Notably, the dollar index (DXY), which tracks the value of the greenback, has risen by 1.18 percent in the last seven days.

4-hour chart

A 4-hour close below the lower edge of the contracting triangle, currently at $1,287, would confirm a short-term top is in place at $1,300 and could yield a stronger pullback to $1,276.
On the higher side, a break above $1,300 would revive the bullish view.

Trend: bearish, triangle breakdown likely

XAU/USD

Overview:
    Today Last Price: 1291.64
    Today Daily change: -1.5e+2 pips
    Today Daily change %: -0.113%
    Today Daily Open: 1293.1
Trends:
    Previous Daily SMA20: 1281.08
    Previous Daily SMA50: 1249.37
    Previous Daily SMA100: 1231.38
    Previous Daily SMA200: 1228.91
Levels:
    Previous Daily High: 1295.25
    Previous Daily Low: 1276.2
    Previous Weekly High: 1297.15
    Previous Weekly Low: 1279.35
    Previous Monthly High: 1284.7
    Previous Monthly Low: 1221.39
    Previous Daily Fibonacci 38.2%: 1287.97
    Previous Daily Fibonacci 61.8%: 1283.48
    Previous Daily Pivot Point S1: 1281.12
    Previous Daily Pivot Point S2: 1269.14
    Previous Daily Pivot Point S3: 1262.07
    Previous Daily Pivot Point R1: 1300.17
    Previous Daily Pivot Point R2: 1307.23
    Previous Daily Pivot Point R3: 1319.22

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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