Early in the American session, Gold (XAU/USD) is trading around 1,924.42, bouncing above the 21 SMA located at 1,919. During the Asian session, XAU bounced around 1,912 and continued to rise. Now, it has gained more than $12 and is showing a resumption of the upward trend.
According to the 1-hour chart, gold has bullish potential and this could cover the GAP that it left at 1,932. The instrument could even reach 6/8 Murray at 1,937 and finally, the high of September 20 at 1,947.
A daily close above 6/8 Murray would indicate the possibility of a new bullish sequence and the instrument could continue to rise and could reach 7/8 Murray at 1,968 and finally, 8/8 Murray around the psychological level of $2,000.
In the next few hours, it is expected that gold can cover the GAP around 1,932. So, as long as it trades above 1,919 (21 SMA), it will be seen as an opportunity to buy at current price levels with targets at 1,932 and 1,937.
On the other hand, gold could fall sharply if it breaks the bullish trend channel formed since October 13 and consolidates below 1,915. Then, we could expect a fall towards the psychological level of $1,900. From there, the door will be open towards the 200 EMA located at 1,883.
The key for the next few hours, we could buy gold as long as it remains above 1,916. In the short term and given that war tensions continue, gold could gain strength and could continue to rise in the coming days.
