Early in the European session, Gold (XAU/USD) is trading around 2,017.12, below the 200 EMA located at 2019.14, and within the downtrend channel formed since May 9.
We can see a strong resistance around 2,020. If gold breaks this area and consolidates above, we can expect it to continue to rise. The instrument can reach the top of the symmetrical triangle around 2,027.
On the H-1 chart, we can see a symmetrical triangle pattern. A sharp break and a daily close above this level could favor bullish momentum that could push the price to the 2,062 zone or could enable a break below it to the 1,937 level.
If XAU/USD manages to break above 2,027 (top of the bearish channel) and stabilizes above, it could gain bullish momentum and move towards 2,062 (+1/8 Murray) and 2,077 (upper limit of descending channel).
Conversely, if gold falls below $2,000 (psychological level and 8/8 Murray) and with a daily close below this level, it is likely that the price of gold will face the next support at 1,937(7/8 Murray).
In the next few hours, gold is expected to consolidate above 2,021. If this scenario happens, we can opt to buy this instrument with targets at 2,028 and 2,062. In case gold falls below 2,020 (200 EMA), it is expected to reach the area of 2,004 which coincides with the bottom of the symmetrical triangle and this could be seen as an opportunity to buy with targets at 2,025.
The eagle indicator reached the oversold zone. Therefore, with any pullback and as long as it trades above the psychological $2,000 level, it will be seen as a signal to continue buying.