Gold (XAU/USD) fell to 1,821 after the US CPI data. A few minutes later, it recovered above 1,828 (3/8 Murray), approaching weekly highs at 1,841.
US economic data showed that the annual rate of the CPI rose to 7.5% in January, the highest figure since February 1982, and above the 7.3% expected.
The data reinforced the Fed's decision to raise interest rates in March, and boosted the US dollar against its rivals.
It is currently trading below the 5/8 Murray and below the 21 SMA with a slight bearish bias.
A daily close above 3/8 Murray suggests some strength in gold, but it needs to consolidate above 1,835 to rally towards the level of 1,843.
If it fails to sustain above 1,830, then a corrective move is likely to follow. Initial support is seen at 1,812, the zone 200 EMA, followed by 1,796 at 3/8 Murray.
US Treasury yields soared to 2.02%, their highest level since 2019 weakening gold's strength. So, the metal fell below support at 1,828.
The eagle indicator has reached the extremely overbought zone at 90-points. Gold is likely to make a technical correction towards the support zone at 1,812 in the coming days.
Our trading plan for the next few hours is to sell below 1,828 with targets at 1,812 and up to 1,796. The eagle indicator supports our bearish strategy.
Support and Resistance Levels for February 11 - 14, 2022
Resistance (3) 1,849
Resistance (2) 1,838
Resistance (1) 1,831
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Support (1) 1,818
Support (2) 1,809
Support (3) 1,802
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Scenario
Timeframe H4
Recommendation: sell below
Entry Point 1,828
Take Profit 1,812, 1,796
Stop Loss 1,835
Murray Levels 1,843 (6/8), 1,828(5/8), 1,812 (4/8), 1,796 (3/8)
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