At the beginning of the European session, the precious metal (XAU / USD) is trading below the SMA of 21 on 4-hour charts, forming a symmetrical triangle pattern. A sharp break is expected to confirm the next direction of the gold price.
The hawkish Fed's stance put pressure on the gold price and also encouraged the US dollar index (USDX) to climb to two-month highs at 92.33. Now the metal price is showing signs of exhaustion.
Two rate hikes by the Fed supposedly scheduled for 2023 affected the attractiveness of gold as a safe haven asset, since it was considered an investment asset that does not accrue interest. However, now there may be a new possibility to act as a refuge.
Gold is likely to gain bullish strength if it consolidates above the 21 SMA on 4-hour charts, located at 1,789. This level is key. If the metal trades above 1,790, the target will be the resistance of 1,812(6/8) and 1,860 (EMA 200).
On the contrary, a break below the lower line of the symmetrical triangle will be a good opportunity to sell below 1,781. There is also 5/8 of a murray, its downward target is seen at 1,750.
We believe that the bullish force could prevail in gold, only if it remains above 1,789. We can buy on that condition. The eagle indicator supports our bullish outlook as it is located 10 points above and showing a bullish signal.
In the American session, we hope that the trajectory of gold will be determined. Our recommendation is to buy above the SMA of 21 and sell below 5/8 of a murray with the targets we have found out in the chart above.
Support and Resistance Levels for June 22 – 23, 2021
Resistance (3) 1,810
Resistance (2) 1,799
Resistance (1) 1,791
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Support (1) 1,777
Support (2) 1,769
Support (3) 1,756
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Trading tip for XAU/USD (gold) for June 22 - 23, 2021
Buy above 1,789 (SMA of 21), with take profit at 1,812 (6/8) and 1,860 (EMA 200), stop loss below 1,780.
Sell below 1,780 (5/8), with take profit at 1,750 (4/8), stop loss above 1,790.
