Early in the European session, Gold (XAU/USD) is trading around 1,826.42 above the 21 SMA and below the 200 EMA. On the 1-hour chart, we can see some exhaustion of bearish strength.
Yesterday, Gold reached a low at 1,817.28 which coincided with February 17's low. From that level, it began a technical rebound, which has left a formation of a double bottom.
In case gold trades above 1,817 and above 1,825 (21 SMA), we could expect a recovery and the price can reach 1,841 (200 EMA) and the top of the downtrend channel that was formed from February 14th.
The last support that could stop the fall of gold is located at 1,812 (2/8 of Murray). Around this level, the instrument could start a strong technical rebound.
Gold has strong resistance at around 1,845. If you look at the chart, gold has tried to break this zone on several occasions and could not succeed. A daily close above 3/8 Murray could reinforce the bullish momentum and the price could reach 1,875(4/8 Murray).
Our trading plan is to buy above 1,817 or above 1,825 with targets at 1,841 and 1,875. The pivot point for today is located at 1,824. In case gold continues to trade above this level, we could expect a prolonged rally in the next several hours.
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