Lingrid | GOLD weekly OUTLOOK

The price of gold surged beyond 2000 to start the week but then had a significant drop. However, the hawkish surprise from the Federal Reserve and the bearish market sentiment helped the XAU/USD pair gain momentum in the second part of the week: on Wednesday, the U.S. central bank increased interest rates once more, but significantly lowered its future guidance. Rates in the United States are now likely to peak much lower than the 5.7% level that the markets had anticipated earlier this month.

On a medium- and short-term basis, XAU/USD is rising. Although it crossed the important psychological level of 2000 on Thursday, there was a pullback on Friday. The market made a double top and divergence on 4H, 1H charts, showing signs of the deeper incoming pullback. The market overall is indecesion phase since we have doji candle on the weekly timeframe. On the daily chart, the RSI indicator is also close to crossing over 70, signaling overbought conditions. In that case, the 1960 level lines up as the first goal below the support at 1940 for bears. The psychological level of 1900 might be the target of an extended correction if the daily close falls below the support at 1940.

Daily:

4H:

1H:

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The price formed a divergence and double top at resistance 2000. I think the market will range as I forecasted in the my last weekly post. In my opinion gold might go down to test support from main resistance IF price makes remains below the psychological price point at 2000. I expect short term correction from the resistance zone between 1980 - 1985. My potential target is the around support level at 1952.