Early in the American session, gold (XAU/USD) is trading around 1,983.75, below the 21 SMA, and within an uptrend channel formed since October 23.
According to the H1 chart, gold will be able to maintain bullish momentum provided that it settles above 1,985. In this case, is it likely to resume its bullish cycle. For this, we should expect a consolidation above 21 SMA and gold could reach the psychological level of $2,000.
The price of gold will remain bullish in the coming days due to simmering geopolitical tensions and concerns about the US government shutdown. This safe-haven asset could surpass the barrier of $2,000 and reach 2,067 and up to 2,125.
On the other hand, in case XAU/USD falls below 1,978, it could mean a breakout in the uptrend channel and the instrument could reach the 200 EMA located at 1,960 and even 6/8 Murray located at 1,937.
Any technical correction occurring in gold could be favorable for the bulls to resume buying opportunities. Only a drop below the 6/8 Murray located at 1,937 on the daily chart could accelerate the decline towards the psychological level of $1,900. If this scenario occurs, we could see a change in gold's main trend.
Our trading plan for the next hours is to buy in case the metal consolidates above 1,985 with targets at 1,994 and $2,000. On the other hand, we should wait for a breakout of the uptrend channel to sell below 1,978 with the target at 1,960. The eagle indicator is generating a bullish signal, albeit showing signs of exhaustion.
