Early in the American session, gold (XAU/USD) is trading around 1,950.74 below the 200 EMA and above the 21 SMA.
We can see that XAU/USD is trading within an uptrend channel formed since August 1st. With a technical bounce at about 1,945, the instrument is likely to resume its bullish cycle.
The area from 1,940 to 1,945 has become a strong support for gold. If a technical rebound occurs in the next few days, gold could offer an opportunity to buy.
Additionally, in case gold consolidates above the 200 EMA at 1,957, we could expect it to continue rising and it could reach 3/8 Murray at 1,968.
According to the H1 chart, gold is consolidating and is likely to trade in a range from 1,940 to 1,957 or 1,968. Gold is expected to move slowly over the next few days in anticipation of the US nonfarm payrolls.
In the medium term, a consolidation above 1,970 is expected and the instrument could reach the psychological level of $2,000. Conversely, a fall below 1,937 could entail a bearish reversal and the metal could reach 1,906, the psychological level of 1,900, and from there tumble to 1,863.
Our trading plan is to buy gold at the levels from 1,945 to 1,940 with the target at 1,968 (3/8 Murray). Since July 31, the Eagle indicator is in the oversold area. So, a technical bounce is expected which could be seen as a buying opportunity.