The price of gold dropped aggressively and now is back in a support zone. It stands at 1,802.40 level above 1,797.90 today's low. The drop could still be temporary if the USD will resume its depreciation after the US data that will be released tomorrow.
As you already know the US Non-Farm Payrolls, Average Hourly Earnings, and the Unemployment Rate indicators could bring high volatility and could change the sentiment again. Worse than expected data could force the yellow metal to increase again as the risk-off sentiment could dominate the markets.
XAU/USD Strong Sell-Off!
Gold dropped by 1.8% since 1,831.77 yesterday's high. Technically, it moves somehow sideways on the H4 chart. Consolidating above the 1,800 psychological level could bring a new upside movement.
I believe that only a new lower low, a valid breakdown below 1,789.69 may signal a deeper decline. The 50% retracement level is seen as strong support, the price could increase anytime from this level.
Forecast!
Gold could still increase as long as it stays above the 50% retracement level and above 1,789.69. An important upside movement could be activated by a valid breakout through the warning line (WL1). Also, a new higher high, a bullish closure above 1,834 may signal upside continuation.
