XAUUSD Current Price: $1,856.33
- Investors welcomed the news that Shanghai will start easing coronavirus restrictions this week.
- Global equities extended their latest advances, although US markets were closed.
- XAUUSD is stuck between familiar levels, but the risk is on the upside.
The price of gold is down on Monday, trading around $1,855 per troy ounce right now. Market participants continue to abandon safe-haven assets in favor of high-yielding assets. Demand for the US currency is absent, preventing the shiny metal from falling further. Additionally, US markets are down due to Memorial Day, limiting price action after the London close.
Asian and European stock indices closed in the green as investors welcomed the news from China. Shanghai is expected to lift coronavirus restrictions from June 1 as scheduled, meaning most businesses will resume operations.
Gold Price Short Term Technical Outlook
The XAUUSD has been hovering around the current level for over a week now and is technically neutral. The daily chart shows that the price is stuck around a slightly bearish 20 SMA, while it sits between the longer longs, which lack directional strength. At the same time, technical indicators are hovering around their midlines, with Momentum rising modestly but RSI holding steady at around 47.
Technical readings in the 4-hour chart also reflect the lack of directional strength, as technical indicators have eased to positive levels but not hinting at some directional movement. Meanwhile, the shiny metal sits above a flat 20 SMA, which is developing into a slightly bearish 100 SMA.
Overall, the downside looks limited as long as gold price holds above $1,839.30, a strong static support level, but gains look unlikely unless the metal breaks above 1 $871.45. Given the general weakness in the dollar, risk-free headlines could end up benefiting gold.
Support Levels: 1,852.00 1,839.30 1,826.30
Resistance levels: 1864.00 1871.45 1880.95
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