- Gold meets fresh supply amid the US dollar turnaround.
- Ascending triangle breakdown spotted on the hourly chart.
- Hourly RSI flirts with the oversold territory, eyes on Powell.
Having faced rejection above $1950 on several occasions so far this Monday, Gold (XAU/USD) came under heavy selling pressure and fell nearly $10 in a matter of an hour.
The latest leg down in the yellow metal can be mainly attributed to a broad-based US dollar rebound, as the risk-aversion tightened its grip in Europe amid mounting coronavirus fears.
Markets also prefer to hold the US currency ahead of the Fed Chair Jerome Powell’s speech due later on Monday.
From a near-term technical perspective, the price broke below the rising trendline support at $1945.58 last hour, confirming an ascending triangle breakdown on the hourly sticks.
The metal faced stiff resistance once again at the horizontal 100-hourly Simple Moving Average (HMA) at $1954.
At the moment, the price trades below all the major HMAs and remains poised to test the pattern target at $1915. Ahead of that level, last Thursday’s low of $1932.88 will likely test the bears’ commitment.
The hourly Relative Strength Index (RSI), currently peeping into the oversold territory, suggests that there is more room to the downside.
On the flip side, recapturing the healthy resistance level around $1950 is critical to reviving the bulls. The 21, 50 and 200-HMAs are aligned around the confluence area.
However, the recovery will gain momentum only on a firm break above the 100-HMA.
Gold: Hourly chart
Gold: Additional levels
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