XAU/USD in a Short term Bullish Range on a Monthly timeframe, could possibly test the 1960 level
The price of gold, on a monthly chart, is currently in a short-term uptrend, while the long-term trend remains bullish. The technical analysis reveals key insights into the current state of the gold market. Notably, the price is positioned above both the 200-day and 50-day moving averages, indicating a strong bullish sentiment. This suggests that the market has been trending higher over both short and long periods.
Scenario 1: Bullish Momentum If the current short-term uptrend continues, the price of gold could move higher, potentially testing the 1960 level. Further upward movement may see the price targeting the 1977 level, which corresponds to the 50% Fibonacci retracement level. Should the bullish momentum persist, a retest of the 1985 level becomes likely. This level holds significance as a potential catalyst for further upward movement towards the 1997.87 level.
Scenario 2: Bearish Correction On the other hand, a bearish scenario could unfold, leading the price of gold to head lower and test the 1933 level. If bearish sentiment persists, this may trigger further downward movement towards the 1924 level, which acts as a major support level for the market. Continued bearishness might push the price even lower, with potential support found in the range between 1908 and 1901, while 1885 serves as a significant support level.
The Relative Strength Index (RSI) for gold indicates an undecided zone, reflecting a lack of clear directional bias at the moment. This suggests that market participants are uncertain about the future price direction.
Despite the short-term uptrend, the overall momentum for the market remains uncertain, indicating the potential for future bearish moves. However, it’s important to note that the market is currently in a range-bound state, with price movements exhibiting a degree of uncertainty.
Key Levels to watch are 1971,1983,1944,1924,1901,1885