In the early hours of the American session, the yellow metal (XAU / USD) is trading within a symmetrical triangle, below the 21 SMA and the 200 EMA, showing slight downward pressure, and with immediate support in the zone of 1,849 and 1,843.
The formation of this symmetric triangle pattern is due to the fact that the market is uncertain about the Federal Reserve's decision. The yellow metal remains above the 1,850 level but still looks vulnerable as long as it hovers below the 200 EMA.
In four hours before the end of the American session, the FED statement will be unveiled. New announcements are not expected, but the key will be to know what signals they will give for further monetary policy. This event could give a lot of volatility to Gold, and there may be a drop to the 1,849 support. Otherwise, if the 1,860 zone is breached, the price could easily go up to 1,875.
If risk aversion takes over the market for the rest of the day, the US dollar is likely to strengthen as a safe haven asset, accelerating the decline in the price of gold. There could be a double bottom in the area of the last low in the 1,843 zone of 7/8 murray.
Our recommendation is to buy above 1,859. Alternatively, if it makes a technical bounce in the 1,849 area, it will be a good opportunity to buy with targets at about 1,875. The eagle indicator is showing a bullish signal.
Support and Resistance Levels for June 16 – 17, 2021
Resistance (3) 1877
Resistance (2) 1867
Resistance (1) 1862
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Support (1) 1849
Support (2) 1842
Support (3) 1832
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Trading tip for XAU/USD (gold) for June 16 - 17, 2021
Buy if rebound 1849 (support), with take profit at 1860 and 1875 (8/8), stop loss below 1844.
Buy above 1859 (SMA 21), with take profit at 1875 (8/8), stop loss below 1854.
