- XAU/USD off the day’s high on the price correction in the Asian session
- More weakness if it slips below $1,780.
- Overbought momentum oscillators reflect the wait-and-hold approach.
Gold prices surrendered the previous day’s gains and are looking to extend pullback in the Asian session. The pair peaked at $1,1794.44 but lost its ground and is looking to refresh the daily lows.
At the time of writing, XAU/USD is trading at $1,785.05, down 0.38% on the day.
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On the 4-hour chart, the pair faces rejection near the highs of $1,800 and forms the spinning top candlestick pattern, which signifies reversal in the prevailing trend. The selling intensified as soon as the price dropped below the $1,788.87 level. On moving lower, XAU/USD bears will first target the $1,780 horizontal support zone and then would march toward the $1,775 resistance turned support area. Finally, the price will pursue the action to retest Monday’s low of $1,766.17.
The Moving Average Convergence Divergence (MACD) indicator is placed above the midline, however, with receding bullish momentum. Any uptick in the MACD will ask for a reversal back to the $1,790 level, followed by Monday’s high at $1,798.02. It would not be an exaggeration to say that, above $1,800, the next on the cards will be February 23 highs at $1,816.07.
