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  • Gold gained positive traction on Tuesday and recovered further from one-month lows.
  • Negative oscillators on 4-hourly/daily charts warrant some caution for bullish traders.
  • Weakness below the $1850 confluence support should pave the way for a further slide.

Gold gained some positive traction on Tuesday and built on the previous day’s goodish rebound from over one-month lows, around the $1817 region. The precious metal maintained its bid tone through the mid-European session and was last seen trading near the top end of its daily range, around the $1860 region.

The recovery momentum pushed the XAU/USD back above 50-hour SMA, which now coincides with a short-term ascending trend-line. The mentioned confluence support is currently pegged near the $1850 region, which should now act as a key pivotal point for traders and will be looked upon for some meaningful opportunities.

Meanwhile, technical indicators on the 1-hourly chart have been gaining positive traction and support prospects for additional intraday gains. That said, oscillators on 4-hourly/daily charts are still holding in the negative territory and yet to confirm the bullish bias, warranting some caution for bullish traders.

Hence, any subsequent positive move is likely to confront a stiff resistance near the $1880 level and might be seen as a selling opportunity. This, in turn, should cap the upside near 100-day SMA, around the $1888-90 congestion zone. However, some follow-through strength beyond the $1900 mark will negate the bearish outlook.

Conversely, a convincing break below the $1850 confluence support will be seen as a fresh trigger for bearish traders. The XAU/USD might then accelerate the slide back towards the $1817 region (one-month lows), before eventually dropping to the $1800 mark en-route November monthly swing lows, around the $1765-64 region.

Gold 1-hourly chart


Technical levels to watch