Currently, the XAU/USD it is fluctuating in a narrow channel above $ 1750. In the opinion of FXStreet analyst Dhwani Mehta, gold remains exposed to downside risks pending a big week.
Bearish control over the price of gold remains intact
“Fed tapering speculation and the energy crisis will continue to dominate market sentiment amid tighter trading conditions for the holidays as the United States and Canada are closed for national holidays. Investors await inflation data from the Wednesday in the United States and the FOMC minutes for a decisive move in the price of gold. “
“Gold found no acceptance above the critical short-term resistance of the 21-day moving average (DMA) at $ 1762 on Friday, leaving the downside risks exposed “.
“At a daily close below the $ 1750-1745 demand area, the Multi-week lows near $ 1720 could be on radars of the gold sellers. “
“A firm breakout above the 21 DMA barrier is critical to initiating a convincing uptrend in XAU / USD. The 50 DMA sloping down at $ 1778 will again be in play, above which a proof of the $ 1800 round number will be unavoidable. “