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Gold Holds Ground But Faces Major Hurdle

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Aayush Jindal

Key Highlights

  • Gold price is consolidating above the $1,775 support zone.
  • A major bearish trend line is forming with resistance near $1,825 on the 4-hours chart.
  • EUR/USD gained pace for a move above the 1.1320 resistance.
  • The US ISM Manufacturing Index could rise from 60.8 to 61.0 in Nov 2021.

Gold Price Technical Analysis

This past week, gold saw a bearish reaction from the $1,880 zone against the US Dollar. The price traded below the $1,840 support level to move into a bearish zone.

The 4-hours chart of XAU/USD indicates that the price even traded below the $1,820 support level. There was a close below the $1,800 level, the 200 simple moving average (green, 4-hours), and the 100 simple moving average (red, 4-hours).

A low was formed near $1,777 and is currently consolidating. An immediate resistance is near the $1,810 level.

The next major resistance is near the $1,825 level and the 100 SMA. There is also a major bearish trend line forming with resistance near $1,825 on the same chart. The trend line is also close to the 50% Fib retracement level of the downward move from the $1,877 swing high to $1,777 low.

A clear break above $1,825 could send the price toward the $1,850 resistance zone in the near term. The next key resistance is near the $1,880 level.

On the downside, the price might remain supported near $1,780. The main support is near $1,760, below which there is a risk of a break below $1,750.

Looking at EUR/USD, the pair started a steady recovery wave above the 1.1320 level. Besides, GBP/USD could also recover if it settles above 1.3400.

Economic Releases to Watch Today

  • Germany’s Manufacturing PMI for Nov 2021 - Forecast 57.6, versus 57.6 previous.
  • Euro Zone Manufacturing PMI for Nov 2021 – Forecast 58.6, versus 58.6 previous.
  • UK Manufacturing PMI for Nov 2021 – Forecast 58.2, versus 58.2 previous.
  • US Manufacturing PMI for Nov 2021 – Forecast 59.1, versus 59.1 previous.
  • US ISM Manufacturing Index for Nov 2021 – Forecast 61.0, versus 60.8 previous.
Great