Chart Art: Spot Gold (XAU/USD) Is at the Bottom of a Range!

June 11, 2024 7:03 am

Spot gold (XAU/USD) is testing the bottom of a technical support area!

Will gold bugs take advantage of the bargain?

Or will fundamentals keep the buyers away?

Gold (XAU/USD) Daily

Gold (XAU/USD) Daily Chart by TradingView

In case you missed it, gold prices dropped sharply on Friday following a stronger-than-expected U.S. NFP report release.

This took XAU/USD to the $2,280 zone, which is right around where the asset found buying pressure at least two times since April, and is currently the top of a technical range in the daily time frame.

Remember that fundamentals typically drive directional biases and volatility conditions in market price. If you haven’t yet done your fundie homework on the U.S. dollar and gold, then it’s time to check out the economic calendar and stay updated on daily fundamental news!

Will gold bugs consider its current prices a bargain?

The U.S. dollar is about to be rocked by top-tier events like the U.S. CPI report and the FOMC’s policy decision this week.

If the events result in net bullish USD strength, then XAU/USD could extend its downswing.

XAU/USD could hit inflection points like the S1 ($2,252) Pivot Point line if not the $2,200 levels near the daily chart’s 100 SMA.

But if gold sees bullish candlesticks from its current prices, then XAU/USD could jump back up to the mid-range and Pivot Point ($2,351) levels. We may even see a return to the top of the range near R1 ($2,425) and the commodity’s previous highs!

What do you think? Will gold attract enough demand from its current levels? Or will XAU/USD extend its pro-USD downswing and force a bearish breakout?

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