XAU / USD regains initial lost ground to seven-day lows, returns above $ 1,900

• Gold managed to attract some buying on the dips on Monday and updated daily highs in the past hour.
• The technical setup still favors bearish traders and supports prospects for further decline.
• The attempt to rise could face stiff resistance and remain capped near the $ 1,918-19 zone.

He oro it reversed an initial drop to the $ 1,891 region, or seven-day lows and updated daily highs for the middle of the European session, although it lacked a strong follow-up.

The good intraday bounce above $ 1,900 stalled near the 200 hourly simple moving average. The aforementioned barrier also coincides with a month-old rising trend line support break point, which should now act as a key point for intraday traders.

Meanwhile, the technical indicators on the one-hour chart have again started to move into the positive territory and support the prospects for a further bullish move. However, the oscillators on the 4 hours / day charts maintained their bearish bias and favor the bears.

Therefore, any subsequent positive movement above the $ 1,905-06 region (support turned resistance) will be seen as an opportunity to initiate new bearish positions. This, in turn, should limit the upside for the XAU / USD near the $ 1,918-19 supply zone.

With that said, some follow-up buying has the potential to push the precious metal towards strong horizontal resistance, around the $ 1,931-33 region. Only a sustained move beyond will negate the short-term bearish bias and pave the way for additional gains.

On the other hand, weakness below the $ 1,890 area, leading to a further advance into the 100-day SMA, around the $ 1,883 region, should accelerate the slide towards the September monthly swing lows support, around the $ 1,848-49 zone.

1 hour chart

Technical levels