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Gold (XAU/USD) spots a potential descending triangle and bearish crossover as US stimulus and vaccine optimism down US dollar along with the yellow metal, FXStreet’s Dhwani Mehta reports.

Key quotes

“The vaccine optimism counters the likelihood of a US fiscal stimulus deal to be reached this week, rendering gold-negative. According to sources, a $908 billion bipartisan coronavirus relief package will be introduced in the US Congress as early as Monday. Also, gold traders remain jittery heading into the much-awaited and the final FOMC monetary policy decision of this year.”

“The sentiment has turned somewhat bearish, as the 21-SMA has pierced through the 50-SMA from above, confirming a bear crossover. Adding credence to the downside, the Relative Strength Index (RSI) point south (currently at 44.58) below the midline.”

“Immediate support awaits at the horizontal 100-SMA at $1830, below which the triangle support at $1823.50 could be tested.”

“A sustained break above the 21-simple moving average (SMA) at $1841 critical resistance could confirm the descending triangle breakout and negate the recent downside bias. The XAU bulls could then challenge the 200-SMA at $1861.”