The price of gold turned to the upside and is trading at 1,991. After such a big drop, a rebound was natural. Still, temporary growth could bring us new short opportunities. Still, the US data could really shake the markets later, so XAU/USD could register sharp movements in both directions.
The greenback crashed ahead of the US economic figures, that's why Gold edged higher in the last hours. The US Flash Services PMI is expected at 51.5 below 52.6 points in the previous reporting period, while Flash Manufacturing PMI could come in at 49.0 points. Better-than-expected data could save the USD from the downside and could push XAU/USD down.
XAU/USD Reached A Dynamic Support!
XAU/USD accelerated its drop after closing below the 1,997 former low. You knew from yesterday's analysis that this scenario opens the door for a deeper drop. Now, it has found support at 1,981 and it has rebounded after retesting the lower median line (lml).
Technically, the lower median line stands as a dynamic support. Now, 1,997 stands as a static resistance and represents an immediate target.
XAU/USD Outlook!
A new lower low, a valid breakdown below 1,981 activates more declines. This scenario is seen as a selling opportunity.
