The price of gold is trading in the red at 1,977 below today's high of 1,985. The bias is bearish in the short term despite temporary rebounds. As you already know, the US manufacturing and services data came in better than expected on Friday confirming expansion.
Today, the technical factors could lead the rate. Fundamentally, only the German ifo Business Climate could bring some action. Tomorrow, the US CB Consumer Confidence, New Home Sales, and Richmond Manufacturing Index could move the price. Also, the Australian inflation figures could be decisive on Wednesday.
XAU/USD Rebound Seems Over!
Technically, the rate escaped from the ascending pitchfork's body signaling a deeper drop. You knew from my previous analysis that a breakdown below the lower median line (lml) activates a bearish continuation.
Still, after its aggressive breakdown, the rate came back to test and retest the broken lower median line and the 1,981 before going down.
XAU/USD Forecast!
As you can see on the H1 chart, the rate failed to retest the lower median line (lml) in the last attempt signaling exhausted buyers. Stabilizing below 1,981 may announce a deeper drop at least towards 1,971 Friday's low. Also, new false breakouts through the lower median line (lml) could announce a new sell-off.
A larger drop and a downside continuation could be activated after making a bearish closure below 1,971. This is seen as a short opportunity.
