Whipsaw Below $2,000; Bear Trap?

Following on from last week’s analysis on spot gold (XAU/USD), you will note that the yellow metal did tunnel through the widely watched $2,000 level in recent trading and shake hands with support between $1,971 and $1,986—made up of an AB=CD bullish pattern (100% projection ratio), horizontal support as well as a number of Fibonacci ratios.

As you can see from the chart, buyers have responded from the upper edge of the support zone, and price is making its way back up to $2,000. A daily close back above the psychological level could encourage further buying, targeting local resistance around $2,038, followed by another layer of resistance on the weekly chart at $2,075.