Gold is trading below the 200 EMA. It has got stuck within a range between 1,796 and 1,806. Yesterday, gold made an attempt to break the moving average around 1,811 but could not hold and undertook a retracement, which lasted until the 1,792 level.
The price of the yellow metal is struggling to break steadily above the 2/8 murray zone at 1,812, which could lead to further bullish momentum. At the same time, it has problems for breaking below 1,790. The price has rebounded above this level a few times. If it breaks this support, it would open the way to the downside with targets at 1/8 of murray.
Today, on Tuesday, the Federal Reserve meeting will begin. The decision will be unveiled on Wednesday. Although no changes are expected, traders will be looking for clues as to whether the central bank is shifting its rhetoric towards hawkish that will have a wide impact on gold and other assets.
Some analysts believe that the Fed indicates a probable decrease in the purchase of bonds starting this year. If so, it could affect the strength of gold and there could be a downward movement in the medium term.
According to the 4-hour chart, gold has a bullish bias, but it should face the EMA of 200 and consolidate above this level to be able to buy with targets at 1,812. Above this level, gold could have a boost around 1,843 (3/8 murray), free of the downward pressure of 2/8 murray.
On the contrary, you can sell below 1,806 because it still remains below the 200 EMA. It could be a limited selling opportunity towards the 1,790 support and a fixed stop loss above the resistance of 1,810.
Support and Resistance Levels for July 27 - 28, 2021
Resistance (3) 1,821
Resistance (2) 1,816
Resistance (1) 1,807
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Support (1) 1,791
Support (2) 1,785
Support (3) 1,776
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Trading tip for XAU/USD (Gold) for July 27 - 28, 2021
Buy above EMA 200 at 1,807, with take profit at 1,812 (2/8) and 1,830, stop loss below 1,803.
Sell below 1,804 (EMA 200), with take profit at 1,790 and 1781 (1/8), stop loss above 1,8010.
The material has been provided by InstaForex Company - www.instaforex.com