Early in the European session, Gold (XAU/USD) is trading around 1,802, retracing below the 6/8 Murray and reaching the area of 21 SMA. Gold is expected to continue its correction in the coming hours and may reach the bottom of the uptrend channel at about 1.785, which has been formed since November 22.
Yesterday in the American session, gold had a volatile movement between 1,813 -1,795 due to the increase in interest rates in the US.
According to the 4-hour chart, gold failed to break and consolidate above 1,812 (6/8 Murray) and is now trading below this level. In case gold continues to trade below 1,812, it will be a clear signal to sell with targets at 1,795 and 1,785.
A sharp break below the uptrend channel could produce a clear signal to resume selling with targets at the 200 EMA located at 1,752.
If XAU/USD consolidates above 1,813, it could reach 1,824 and even hit the strong resistance of 7/8 Murray around 1,843.
Our trading plan for the next few hours is to sell below 1,807. In case there is a pullback around 1,812, we could also sell with targets at 1,798 and 1,781 (5/8 Murray). The eagle indicator is giving a negative signal which supports our bearish strategy.