The price of gold is trading at 2,038 at the time of writing, far below 2,070 today's high. XAU/USD rallied as the global economy is under pressure amid geopolitical tensions. As you already know, Gold is very attractive when the risk-off sentiment dominates the markets. Despite temporary declines, XAU/USD could resume its growth.
On Thursday, the ECB and the US inflation data are seen as the most important events of the week. These high-impact events could force the price of Gold to register sharp movements in both directions.
XAU/USD False Breakout With Great Separation!
XAU/USD rallied but it has failed to stay above the upsloping line, above the channel's resistance, or to reach the 2,075 static resistance, the former high. After such an amazing rally, a temporary decline is in cards.
Technically, temporary drops could help the buyers to catch a new leg higher, new buying opportunities. Also, a minor consolidation, a sideways movement could announce an upside continuation.
XAU/USD Prediction!
The weekly R2 of 2,025 stands as an immediate downside obstacle. Staying above it may signal potential further growth. Dropping, closing, and stabilizing below the R2 may signal a potential drop towards the 2,000 psychological level and down to the weekly R1 of 1,998.
