XAU/USD: technical analysis 02.01.20

Current trend

On the 4-hour chart, the instrument shows a moderate negative dynamic. The breakdown and pair’s sustained trading below 1519.57 – 1517.58 will let the price to decline to the area of 1515.63, which coincided with the middle line of Bollinger Bands. There is a high chance of an upward rebound, while its breakdown would allow the fall to continue to 1513.67.

Alternative scenario

The pullback above 1521.48 will give a prospect of growth to the area of 1523.44-1524.81 resistance. This area can prevent the instrument from growing, as the possibility of the reverse of the price is high there. However, the decisive break of 1524.81 is needed to indicate the uptrend resumption. In this case, the next targets of buyers will be the level of 1527.34.

Technical indicators

Technical indicators mostly maintain a sell signal.

Bollinger Bands are pointed sideways.

MACD volumes are decreasing in the positive zone.

Stochastic has left the overbought area and is pointed downwards, reflecting the high possibility of the downward movement formation.

Support and resistance

Support levels: 1519.57, 1517.58, 1515.63, 1513.67.
Resistance levels: 1521.48, 1523.44, 1524.81, 1527.34.

Trading recommendations

Short positions can be opened below the level of 1519.57 with the target at around 1517.63-1515.63 and stop-loss at 1520.87.
Long positions can be opened above the level of 1521.48 with the target at around 1523.44-1524.81 and stop-loss at 1520.48.

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