- Gold falls for the second day in a row, as the dollar strengthens and yields rise.
- Technical outlook points to some XAU / USD weakness.
Gold extended the slide after being rejected from levels above $ 1,850 on Wednesday and the 200-day moving average. On Friday it is falling for the second day in a row and bottomed out at $ 1,812 in the European session, the lowest level since Monday.
It is trading around $ 1,815, still pointing to the downside, in a context of a strong dollar and rising Treasury yields. The DXY is trading at 90.60, a day high.
From a technical perspective, the support of the 200 hour moving average gave way in the 1834-33 region, increasing the downward pressures. The consolidation below $ 1825, keeps the doors open for a drop towards $ 1800.
The bearish outlook is reinforced by the fact that the technical indicators on the day chart they have been struggling to recover from negative territory. Therefore, a subsequent decline towards monthly lows, around the $ 1,785 region, en route to the $ 1,764 zone, levels tested in November 2020, remains a clear possibility.
On the other hand, $ 1825 region now turns into strong immediate resistance. A firm move above could trigger some short covering move and push the XAU / USD towards the 1842-44 resistance zone. The next strong barrier is in the region of $ 1854-55 (200-day average), which if it is exceeded, any short-term bearish bias will be canceled.
XAU / USD day chart
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