Gold Price Forecast: XAUUSD points to resume the downtrend

Gold Price rebounds from two-month lows. A good selling opportunity? FXStreet’s Dhwani Mehta reports.

Gold Price eyes acceptance above Fibonacci 23.6% 

“XAUUSD has recaptured the $1,902 hurdle, which is the Fibonacci Retracement (Fibo) level of the correction from April 18 highs of $1,998 to the two-month troughs of $1,872. If bulls manage to find a strong foothold above the latter on a daily closing basis, then the recovery could extend towards the April 26 highs of $1,911. Further up, the Fibo 38.2% of the same decline at $1,921 will challenge the bearish commitments.”

“The 14-day Relative Strength Index (RSI) is edging higher but remains well below the midline, suggesting that the bearish bias remains intact in the near-term. Also, a bear cross confirmed Wednesday is in play, adding credence to the resumption of the downtrend.”

“Selling resurgence could see a retest of the daily lows at $1,892, below which the April 27 low of $1,881 will be targeted. Thursday’s low of  1,872 will be the level to beat for XAUUSD bulls should bears keep their sights on the $1,850 psychological barrier.”