On the daily chart below, we can
see that after tapping into the record high at 2076, Gold started to fall as
better than expected economic data lifted treasury yields and boosted the US
Dollar. The price yesterday broke below a key trendline which is the base of an expanding
wedge pattern.

We should now see the price
falling towards the 1930 level where we can also find the 50% Fibonacci
retracement level and the major trendline. That support zone is expected to be really strong,
and the buyers are likely to pile in there with defined risk below the
trendline. The sellers, on the other hand, will want to see the price breaking
below the support zone before piling in more aggressively and extend the
selloff towards the 1800 level.

XAUUSD
technical analysis

On the 4 hour chart below, we can
see the breakout that happened yesterday after the better than expected US
Retail Sales data. The sellers are now clearly in control and
barring any negative news like a big miss in Jobless
Claims tomorrow or Fed Chair Powell being dovish on Friday, gold should
continue to fall towards the 1930 level.

On the 1 hour chart below, we can
see more closely the recent price action. The sellers should keep on piling in
at the break of the swing low at 1985. If the breakout fails, the likely
pullback should run towards the 2000 resistance where we can also find the
38.2% Fibonacci retracement level. The sellers will be waiting there with
defined risk just above the resistance zone and the 1930 level as target. The
buyers, on the other hand, will need a break above the trendline to regain some
control and target the 2076 high.

This article was written by ForexLive at www.forexlive.com.