02, December 2016

XAU/USD (a 4-hour chart)

General overview

Gold prices slightly recovered after a recent decline to 10-month low. A weak dollar retracement helped the yellow metal to reverse some losses. However gold recovery was limited due to strong expectations of the Fed hike action in December.

Current situation

Daily technical studies remained bearish. Gold met a barrier around 1160 and bounced off it. The price recovered to the 1180 region where the upwards momentum lost its strength ahead of the Europe opening. Gold prices suffered a short lived downward movement and moved to 1170 in the mid-Europe trades. According to the 4 hours chart the price continued developing well below the moving averages which maintained their bearish slope. The resistance exists at 1180, the support stands at 1170 dollars per ounce.

MACD remained at the same level which confirms the strength of sellers. The RSI indicator continued consolidating within oversold levels.

Trading recommendations

We expect to see renewed bearish pressure. The next level to focus on is 1160.