In the early Asian session, XAU / USD (gold) is trading above the 200 EMA and below the strong 8/8 Murray resistance that coincides with the 21 SMA, showing a slight bullish bias, although it is limited by the key level of 1,875.
Yesterday at the opening of the American session, gold fell to the 7/8 Murray support located at 1,844. Just at that level, gold made a very strong technical rebound until closing the trading day at 1,866. Now it is consolidating above EMA of 200.
In the chart, you can see that XAU / USD is trading within a 4-hour downtrend channel. Yesterday it was confirmed by bouncing at the bottom of the channel, which suggests that there could be an upward movement until it tops the sloping line at 1,895.
Given that now Gold is below the SMA of 21 (1,879), this means that below this zone the downward pressure will continue, and could take it to the support zone of 1,844 and 1,840.
This week, the Federal Reserve meeting will take place. The possibility that the FED policymakers could make some cuts in the asset-purchase program contributed to the fall of the Gold. It is expected that the volatility of the market will continue this week with relevant data in the United States.
Our recommendation is to buy above the 200 EMA. So, we expect a setback to the 1,856/53 support area. At this level, there may be a technical rebound. In this area, we recommend buying with targets at about 1,875.
Below the 200 EMA, if gold closes and consolidates below this level, there could be a downward move to the 7/8 murray support at 1,844.
Support and Resistance Levels for June 15 – 16, 2021
Resistance (3) 1,914
Resistance (2) 1,896
Resistance (1) 1,880
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Support (1) 1,849
Support (2) 1,828
Support (3) 1,810
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Trading tip for XAU/USD (gold) for June 15 - 16, 2021
Buy if the price rebounds to 1,853 (EMA 200), with take profit at 1,875 (SMA 21), stop loss below 1,848.
Sell if the price pulls back to 1,875 (8/8), with take profit at 1,856 and 1,844, stop loss above 1,881.
The material has been provided by InstaForex Company - www.instaforex.com