Gold (XAU/USD) is trading around 1,762, below the 21 SMA and inside a downtrend channel formed on the 4-hour chart since November 9.
Gold is likely to find strong support around the area 1,750. This level coincides with the 8/8 Murray and the bottom of the downtrend channel.
This could be an opportunity to buy gold above 1,751 with targets at 1,769 (21 SMA) and 1,812 (+2/8 Murray). Only if there is a sharp break above 1,770, will it be a signal to resume buying.
Conversely, with a sharp break and a daily close below 1,750, we would expect a bearish acceleration. Hence, the price could fall towards 1,718 and towards the psychological level of 1,700 which coincides with the 200 EMA.
The eagle indicator is testing a downtrend channel which is giving a positive signal for the next few hours. In case there is a bounce around 1,751, it will be a signal to buy or we could sell at current price levels if gold remains below 1,769 (21 SMA).
Our trading plan for the next few hours is to sell below 1,769 with targets at 1,750. To buy, we must wait for a technical bounce at 1,750 or a consolidation above this level with targets at 1,769 and 1,781.
