The strong positive momentum that had existed after the failure of the Silicon Valley Bank has come to a stop, as can be seen on the daily chart below. After such a powerful gain, the market is now retracing, and the trend line, which also contains the 50% and 61.8% Fibonacci retracement levels, is the most likely place to find support. As the consolidation around the 2000 level has lasted for more than a week, the moving averages are also about to cross to the negative.
According to the technical analysis of the XAUUSD, the price
has been deviating while the MACD has been trading within the ascending
channel. Given that the price has now broken out, a correction to the channel's
base is expected to occur.
With the price having broken out, a correction to the
channel's base, which coincides with the 50% Fibonacci level, is expected to
occur. Currently, the price movement is rangebound, and the 1982 level support
is still firmly in place. The current range between the support at 1982 and the
resistance at 2022 may be seen on the 1-hour chart below. In order for buyers
to swarm in and hit the high at 2087, they will need to see price action
breaking above the range's top and returning to the channel. The 50% Fibonacci
level will be the aim for the sellers, who would want to see the price break
below the 1982 support level. The US Jobless Claims data, which has recently
been a market-moving event, is due out tomorrow. If the data fall short of
expectations, gold should increase while a beat should cause it to decline.
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