- Gold prices are struggling against a key confluence of resistance around $ 1,785 / 86.
- The three-day downtrend line adds to the upward filters.
- New selling will await a confirmation of the bearish chart pattern.
Gold rises towards the $ 1,785 region, gaining 0.50% on the day, just before the European session on Tuesday. The yellow metal fell to a five-month low the previous day, before bouncing off the $ 1,764 level.
While the RSI oversold conditions favored the bulls to make gradual recovery moves, the underlying bearish pattern, a rising wedge, keeps sellers hopeful. Also, failures to break above the 50 hourly SMA and short-term resistance line are some additional factors favoring gold bears.
However, the downside move needs confirmation of a break to the downside of the rising wedge support, now at $ 1,780, before again targeting the multi-month low near $ 1,764. It should also be noted that the May 2018 peak, around $ 1,765, adds strength to the support before targeting the April high of $ 1,747.
Meanwhile, an upside breakout of confluence resistance at $ 1,786 must break above a downtrend line from Nov. 26, currently near $ 1,798, before confirming a further recovery.
A sustained move above $ 1798 and the round level of $ 1,800 is the key to moving higher towards the September low around $ 1,849.
Gold 1 hour chart
Gold technical levels
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