Gold Price Forecast: Rejection at $1,832, puts XAU/USD on path to $1,760

The spot Gold Price continues the slide below $1,800 in early trade on Thursday as investors react to a stronger US Dollar. The last few days have seen a 180-degree change in sentiment for the yellow metal. Last week’s miserable employment data sent spot Gold hurtling towards the key $1,832 resistance level. Not to mention that Friday’s closing price of $1,834 should have set the stage for the Gold price to run higher this week. However, that has not been the case.

Gold got off to a cautious start on Monday as fears of an economic slowdown lit a safe-haven bid under the dollar. Over the weekend, Goldman Sachs marked down their 2021 US GDP estimate for the second time in as many months, citing the soft employment data and the impact of the delta-variant covid-19 strain. This prompted a rush to the greenback, which has derailed any hopes of the Gold price breaking out on the upside for the moment.

XAU/USD Price Forecast

The daily chart shows the reversal from $1,832 has pushed the Gold price below the 50,100 and 200-day moving averages at $1,800.5, $1,804.1, and $1,804.05, respectively. This is clearly a negative development and reinforces the short-term bearish outlook.

In addition, the Relative Strength Index (RSI) has turned lower and trending downwards. Furthermore, the Moving Average Divergence Convergence Indicator (MACD) has flipped into negative territory, lending weight to the deteriorating technical outlook.

As long as the Gold price remains below the 200 DMA, a test of the $1,760 support looks probable. Although if the dollar strength persists, a leg lower to the major support at $1,676 cannot be ruled out.

As mentioned, this view relies on the price remaining below $1,804. On that basis, a close above this level invalidates the bearish outlook and suggest a possible run back to $1,832.

Gold Price Chart (daily)

gold price
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