FX.co ★ Gold under strong upside pressure

The price of old retreated a little in the short term, but the bias remains bullish in the short term. It was located at 1,845 at the time of writing, below today's high of 1,849. XAU/USD retreated a little as the DXY rebounded. Now, the Dollar Index reached a strong supply zone, so a new sell-off should help the yellow metal to extend its growth.

Fundamentally, the Eurozone and Canadian data came in mixed. Surprisingly or not, the XAU/USD stays higher despite the US ISM Services PMI and Final Services PMI coming in better than expected earlier.

XAU/USD in the buyers' territory

Technically, you knew from my previous analysis that XAU/USD could resume its growth as long as it stays above 1,830. It has climbed to as high as 1,849 levels, where it has found temporary resistance.

It has dropped a little, but it has registered only a false breakdown with great separation below the median line (ml) signaling strong upside pressure and buyers. As long as it stays above the median line (ml), it could jump towards new highs. Only a valid breakdown below this dynamic support level invalidates further growth.

XAU/USD outlook

A bullish closure above 1,849 is seen as a new buying signal. The S2 of 1,861 and the upper median line (uml) represent major targets.