Early in the American session, Gold (XAU/USD) is trading around 1,920 above the 21 SMA within a downtrend channel formed since June 14.
On the 1-hour chart, we can see that on June 22, gold reached the extremely oversold zone, which is likely to be giving a positive signal. So, the price could reach the top of the downtrend channel around 1,926 in the next few hours and 7/8 Murray at 1,937.
In case of a sharp break above this downtrend channel, we could expect gold to continue its rise. Therefore, the instrument could reach the 7/8 Murray located at 1,937 and finally, the 200 EMA located at 1,940.
Our trading plan for the next few hours is to buy gold around 1,920 (21 SMA) with targets at 1,926 and 1,937. The Eagle indicator is giving a positive signal which supports our bullish strategy.
