Early in the Asian session, gold reached 1,902.30 amid renewed tensions on the Russian-Ukrainian border. Demand for safe-haven assets has been boosted by concerns that Russia is preparing for an invasion.
Yesterday at the European session, Ukrainian forces and Russian rebels exchanged fire. This headline helped gold rise above +1/8 Murray.
The XAU/USD pair is trading at 1,898 at this time of writing after reaching a high of 1,902.30. These levels were previously seen in June 2021.
The 4-hour chart shows that the eagle indicator has reached the 95-point level, which represents an overbought zone. The bullish move could stop and a correction could occur in the next few days.
SMA 21 is located around 1,870, below the support of 1,875 (8/8 Murray). The uptrend could extend again if the metal breaks above 1,906 (+2/8 Murray). This is its immediate resistance level. The price is likely to consolidate below this level in the coming days.
According to the 4-hour chart, the positive outlook for XAU/USD will remain intact as long as it trades above 1,875. Any pullback towards this support zone at 1,875 or towards the 21 SMA at 1,870 will be a buying opportunity.
Our trading plan for the next few hours is to sell below 1,898 or wait for a pullback towards +2/8 Murray at 1,906 to sell. The short-term target is the zone 1,875. It coincides with the support level 8/8 Murray and the bottom of the uptrend channel.
Support and Resistance Levels for February 18 - 21, 2022
Resistance (3) 1,922
Resistance (2) 1,910
Resistance (1) 1,902
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Support (1) 1,879
Support (2) 1,875
Support (3) 1,859
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Scenario
Timeframe H4
Recommendation: sell below
Entry Point 1,898; 1,906
Take Profit 1,890; 1,875
Stop Loss 1,910
Murray Levels 1,906 (+2/8), 1,890(+1/8), 1,875 (8/8), 1,843(6/8)
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