Gold Price Analysis: XAU/USD healthy technical picture eyes 2,000 in the near term

• Gold rips from the impact of COVID-19 as investors seek to hedge against the struggling global financial markets.
• Gold is technically in the hands of the bulls with gains above 2,000 still in the sight glass despite the recent retreat.

After gold hit levels above the former resistance at 1,800, the bullish case to 2,000 became apparent. This was reinforced by the impact of COVID-19 on global financial markets with most investors moving their holdings to the precious metal in order to hedge against the falling prices. Markets such as stocks have continued to suffer greatly even as the fight against Coronavirus intensifies.

Recently, the world’s most precious metal hit highs close to 2,000 before retreating to find support at 1,940 as covered in the price analysis on Saturday. Most analysts believe that consolidation is the way to go before gold makes its case above 2,000. In this case, there are a number of support areas including 1,960, 1,940 as well as 1,920.

From a technical point of view, XAU/USD is looking towards a week filled with action, especially with the RSI hitting the overbought region. The indicator is a metric to watch as it would help pinpoint the direction gold would take in the new week’s trading. Note that, there is high congestion of sellers at 1,980 but a massive breakout awaits gold on overcoming the psychological hurdle at 2,000.

XAU/USD weekly chart