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Gold short-lived rebound, back at support

Gold plunged from today's low of 1,815.57 and now it is traded at 1,793.03 above 1,780.41 today's low. In the short term, the yellow metal is trapped within a range pattern. Escaping from this formation could bring new trading opportunities.

XAU/USD rebounded as the Dollar Index was into a corrective phase. Also, a new COVID-19 variant brought a risk-off sentiment into the markets, that's why the yellow metal was very attractive for buyers.

XAU/USD range pattern


Gold is trappped between 1,812.43 and 1,782.04 levels. It has registered only a false breakout with great separation through 1,812.43 and above the median line (ml) siganling that the rebound could be over.

The yellow metal tries to rebound after its sell-off, it has failed to close below the uptrend line and under 1,782.04. It could still increase as long as it stays above the uptrend line.

XAU/USD prediction

A valid breakdown below the uptrend line and under 1,782.04 could activate a deeper drop. Staying above the uptrend line followed by a valid breakout above the median line (ml) could announce potential leg higher.

The material has been provided by InstaForex Company -