Gold dropped aggressively yesterday around the US data release. It has declined as much as 1,756.12 level but it has closed higher signaling a strong demand in this area.
The rate challenges dynamic support at the time of writing, it remains to see how it will react after the Eurozone and the US data today. Some poor US data reported today could send the yellow metal higher again.
Only better than expected US data followed by a USDX's rally could push the price of gold lower.
XAU/USD Still Bullish!
Gold decreased after failing to reach the 1,800 level and to stabilize above the R1 (1,795.49). Its drop below the ascending pitchfork's median line (ml) signaled the current decline.
Now it has found support right above 1,755 static downside obstacle registering only a false breakdown below the weekly S1 (1,761) and through the inside sliding line (sl).
Forecast!
Yesterday's false breakdown with great separation below the weekly S1 (1,761) signals an upside momentum in the short term. Gold could increase also if the USDX declines after its temporary rebound.
The weekly pivot (1,779) is seen as a first upside target. Only a valid breakout above it could signal a further growth towards R1 (1,795).
The material has been provided by InstaForex Company - www.instaforex.com