The price of Gold is trading at 1,771 at the time of writing. As you already know, XAU/USD rallied as the Dollar Index was in a corrective phase. Now, the price action signaled exhausted buyers. Still, a downside movement needs strong confirmation as the bias remains bullish in the short term.
Fundamentally, the yellow metal reacted aggressively today after the US economic data. The PPI reported only a 0.2% growth compared to the 0.4% growth expected, Core PPI surged by 0.0% less versus the 0.3% estimated, while Empire State Manufacturing Index came in at 4.5 versus -6.1 points forecasted.
XAU/USD Uptrend Unharmed!
Technically, XAU/USD registered a false breakout through 1,784 and above the warning line (wl1) today signaling exhausted buyers. The uptrend line and 1,766 represent downside obstacles.
As long as the price stays above the uptrend line, XAU/USD could still resume its growth. False breakdowns could announce a new upside momentum.
XAU/USD Forecast!
A valid breakdown below the confluence area formed at the intersection between 1,766 with the uptrend line activates a deeper drop. This brings new short opportunities.
An upside continuation could be activated by a valid breakout through 1,784 and above the warning line (wl1).
