- Gold bottoms at $1,196/oz and rebounds to $1,200.
- The intraday trend continues to point to the downside, a break above $1,207 could change bias.
Gold is about to end the day hovering around $1,200/oz, down $6 for the day. The yellow metal broke to the downside a 36-hour range and fell to $1,196 (lowest level since last Friday) before bouncing modestly to the upside.
Despite the sell-off in emerging markets and renewed trade concerns about US-China failed to boost the demand for the yellow metal. Bloomberg reported that US President Trump backs hitting China with another round of tariffs on $200B on Chinese goods.
XAU/USD Technical outlook
“The daily chart for the bright metal shows that the price is currently pressuring a mild bearish 20 DMA, developing far below the larger ones, which maintain their bearish slopes. In the same chart, technical indicators turned south, with the RSI currently at 46, anticipating some further declines ahead on a break below the mentioned daily low, the immediate support”, says Valeria Bednarik, Chief Analyst at FXStreet.
In the short-term, she points out that according to the 4 hours chart, the metal is biased lower, now below its 20 and 200 SMA and barely holding above a bearish 100 SMA, while technical indicators remain well into negative territory, with the RSI continuously grinding lower.
To the downside, support levels might be seen at $1,196 (daily low), followed by $1,192 and $1,182. On the upside, resistance could be located at $1,201 (Aug 22 high), $1,207 and $1,214.
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