Early in the American session, gold (XAU/USD) is trading around 1,955.45 with a very clear uptrend, facing strong resistance around 1,957.
Yesterday, the price of gold fell from the high of 1,962 to 6/8 Murray around 1,937. From that level, it has been bouncing and is now showing signs of exhaustion.
The short-term outlook for Gold remains bullish as tensions in the Middle East have escalated following the hospital explosion in Gaza. Investors consider gold a safe refuge in these crisis situations.
Technically, gold could surpass its 1,962 high and the price could seek 1,968 (7/8 Murray). Finally, it could reach the psychological level of $2,000 (8/8 Murray). If gold consolidates above 1,970, the positive outlook suggests the price could reach $1,985 and $2,000.
On the other hand, according to the H4 chart, gold is technically overbought. A break of the bullish trend channel around 1,949 could favor a correction towards the 6/8 Murray support at 1,937. If bearish pressure prevails, the metal could fall to 1,922, where it left a gap on October 17, and finally, until the psychological level of 1,900.
