Gold set a nice foothold around the 20-day simple moving average (SMA) and sped up to close above a short-term resistance trendline and the 200-day SMA on Friday. The neutral market structure, however, is still intact and only a rally above the 1,835 ceiling would raise confidence in the ongoing upward move.
Encouragingly, the RSI continues to trend upwards above its 50 neutral level and the MACD has finally entered the positive territory, boosting optimism the recent bullish appetite in the market could last in the coming sessions.
Should the bulls snap the 1,835 bar, the door would open for the 1,870 restrictive region. Beyond the latter, the price may head for the key 1,900 – 1,916 resistance zone.Alternatively, a downside reversal may find support near the broken trendline and the 20- and 50-day SMAs currently within the 1,792 – 1,783 zone. If the sell-off extends below 1,770, the bears could gear down to 1,750. Breaching the latter too, the spotlight will shift immediately to the 1,717 low from August 10.
Meanwhile in the long-term picture, the downtrend from the 2,079 peak remains valid as long as the price continues to fluctuate below 1,959.
In brief, gold’s short-term bias is tilted to the upside, but its market structure remains neutral. A decisive step above 1,835 would print new higher highs in the chart and therefore raise bullish forces.
