As observed on the daily timeframe, Gold price confirmed a descending triangle formation after closing Friday above the falling trendline resistance at $1,650. The upsurge in the yellow metal took out the critical 21 and 50-Daily Moving Averages (DMA), with bulls managing to settle the week above the 50DMA at $1,675.
XAUUSD price is challenging the latter on its retreat, looking for a test of the 21DMA resistance-turned-support at $1,653, should the pullback extend. The 14-day Relative Strength Index (RSI) has turned south but holds above the midline, suggesting that any retracement in the price is likely to be bought in. On the upside, buyers need to reclaim the previous day’s high at $1,682 in a bid to initiate a fresh rally towards the $1,700 mark.
All in all, it seems that the tide has turned in favor of bullish traders after Friday’s big technical breakout.
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