Gold (XAU/USD) is chugging along at $5,165, clinging to the underside of the $5,193 resistance zone that previously did duty as a support level. Price remains contained within a rising channel, but more and more lately, we are seeing those prices poking above the channel top – with long upper wicks near $5,420, all that says to me is the sellers are getting a little anxious to step in.
That sharp bearish plunge to $5,080 was followed by some pretty uneventful candles, the kind that suggest the short-term picture is consolidating rather than anything more dramatic.
The 50-EMAs are sort of flat-lining just above $5,240, while the 200-EMAs are still very much staying on the rise around $5,120, which to me looks pretty constructive when I look at the bigger picture. The RSI, not having a clue, stuck in the middle, at 50, reflects just how neutral the momentum is at the moment. A break above $5,193 opens the doors to $5,276 & $5,360, but if that doesn’t happen, we risk seeing a visit to $5,080.
Trade idea: Buy above $5,200, aiming for $5,276, stop below $5,120.