- Gold is trading in the positive territory for third straight day.
- Next significant resistance for gold is located at $1,745.
- Sellers could look to take control if XAU/USD drops below $1,720.
After closing the previous two trading days in the positive territory, the XAU/USD pair rose to its highest level in more than a week at $1,739 on Thursday. Although the pair seems to have gone into a consolidation phase ahead of the American session, the technical outlook suggests that it could extend its recovery to $1,745 area. As of writing, gold was up 0.47% on the day at $1,734.90.
Gold technical outlook
On the four-hour chart, the Relative Strength Index (RSI) indicator stays below 70, suggesting that there is more room for gold on the upside before it turns technically overbought in the near term. The initial target could be seen at $1,745 (Fibonacci 38.2% retracement of the February-March drop) ahead of $1,750 (100-period SMA). A decisive break through the latter could open the door for additional gains toward $1,765 (Fibonacci 50% retracement).
On the downside, $1,720 (Fibonacci 23.6% retracement) aligns as a key support. If sellers manage to drag the price below that level, the next support is located at $1,710 (20-period SMA, 50-period SMA) before $1,700 (psychological level).
Additional levels to watch for
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