Early in the American session, gold is trading around 2,602, bouncing off the low of 2,582. Now the price is above 2,600 which means it could continue its rise in the next few hours and reach the 21 SMA around 2,645.
Technically, XAU/USD is below the key pivot point located at 2,656 which means that it could reach the 200 EMA located at 2,512 in the short term and even reach the psychological level of $2,500.
Our outlook is bearish, so we will look for opportunities to sell below 2,590. Besides, in case it bounces back to 4/8 Murray, it will be seen as an opportunity to sell.
Technically, we can see that gold has reached oversold levels on the daily chart. The gap left at 2,562 remains to be covered. All this means that gold could make a strong fall and then make a sustained technical rebound.
Our trading plan for the next few hours is to sell gold if it falls below 2,590 or buy above 2,600 with targets at 2,645 and 2,656.