Gold price has staged a major move to the south after it completed the breakdown of the small ascending channel on the daily chart. Thursday’s 0.83% move lower accompanies further strengthening of the greenback across a basket of assets, which was showcased as a 0.17% rise in the US Dollar Index.
Ahead of the US Non-Farm Payrolls report tomorrow, what are the key technical levels to look out for?
Technical Levels to Watch
Today’s downside move appears to have found support at the 1821.55. However, that support level remains under threat as an intraday violation appears to be playing out. A confirmed breakdown of this level opens the door towards the 1800.34 psychological support, which also housed several lows in December and January.
On the other hand, a bounce off 1821.55 is needed to temporarily forestall a further decline in the short term. However, the bulls need to push gold prices above the upper edge of the larger descending channel to give the XAU/USD a chance at recovery. This move would allow 1869.39 to become a feasible target, with 1881.99 and 1900.76 lining up as immediate upside targets.
Gold Price (XAU/USD) Daily Chart