XAU/USD (a 4-hour chart)
Gold prices hit 6-week highs amid broad base dollar retracement due to growing uncertainty over the Fed rate hike in 2017. The first Trump’s conference in 2017 attracts investors’ attention now.
Gold extended its near-term bullish momentum and rose to its highest level since early December on Tuesday. Buyers led the price from 1180 to 1187 dollars per ounce where the advance lost upward momentum. A light selling interest weighed on the pair pushing it to 1182. The price hovered above the moving averages in the 4 hours chart. The 50-EMA kept pointing higher and crossed the 200-EMA upwards. The 100 and the 200-EMAs were neutral. The resistance exists at 1190, the support stands at 1180 dollars per ounce.
MACD decreased which indicates the buyers’ positions weakening. RSI indicator remained within undervalued territory.
We hold the view that gold prices will drop below the 1180 handle. The next level to focus on is 1170 dollars per ounce.