FX.co ★ Trading Signal for GOLD (XAU/USD) on August 9-10, 2023: buy in case of rebound at $1,919 to $1,913 (weekly suppor - oversold)

Early in the American session, gold (XAU/USD) is trading around 1,923.71. It is trading under bearish pressure after reaching the top of the downtrend channel and failing to break it around 1,930.

In the next few hours, we expect gold to continue falling until reaching weekly support around 1,919 or it could even reach daily S_2 around 1,913.

If bearish pressure prevails, gold could reach 5/8 Murray's around 1,906. This area will serve as a strong technical bounce and we could expect gold to recover above this level.

However, on August 8, gold reached the extreme oversold zone around 5 points on the eagle indicator, which means that an imminent technical rebound could occur in the next few hours only if gold reaches the support of 1,919 or 1,913.

After a technical rebound and in case of a rise in the bullish force, a sharp breakout of the downtrend channel formed since July 27 is expected. If this scenario takes place, we could expect a break above 1,930 and this could reach 6/8 Murray located in 1,937 and even 7/8 Murray in 1,968.

Our trading plan for the next few hours is to wait for gold to drop to the 1,919 or 1,913 support levels to buy with targets at 1,925 and 1,933.

We must be careful in entering these levels to buy because the bearish force still prevails. If you are selling from resistance levels, it is better to continue selling until reaching the support of 1,919 -1,913 which would be your objective.

The 10-year Treasury yield broke above the 4% level which puts downward pressure on gold. However, we do see a technical correction which is likely to be absorbed by gold in the coming days and this will be favorable for gold and it could reach the level of 1,950.