Technical Analysis: Gold buyers brace for $1,850

Gold prices recently pulled back from 50% Fibonacci retracement amid overbought RSI conditions on the four-hour chart. However, the commodity remains inside a monthly rising channel and the MACD signals are bulls as well, which in turn keeps gold buyers hopeful, Hence, a clear upside break of $1,834 immediate hurdle will propel the quote to the stated channel’s resistance line near $1,850 but any further upside may have to take a breather. Should the yellow metal keeps rising past $1,850, 61.8% Fibonacci retracement level of $1,853 and the mid-June tops surrounding $1,870 will challenge the north-run.

On the contrary, the latest pullback aims 38.2% Fibonacci retracement level of $1,814 but a confluence of channel support and 100-EMA, around $1,807 could trigger a fresh bounce. In a case where the gold defies the bullish chart pattern with a downside break of $1,807, the $1,800 threshold and 23.6% Fibonacci retracement level near $1,790 may entertain sellers ahead of directing them to the previous month’s low near $1,750.

Join us on FB and Twitter to stay updated on the latest market events.