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Early in the European session, Gold (XAU/USD) was trading around 1,816.30, above the 21 SMA and below the strong resistance at 1,823.
Yesterday, gold managed to accelerate its bullish movement after bouncing around 1,804. The strength of gold was caused by a fall in US bond yields, which weakened the US dollar and helped gold to approach the levels of 1,812 - 1,818.
On the technical level, according to the 4-hour charts, we can see the XAU/USD pair maintains the upward trend, it is expected to reach $1,824 again and climb up to the December maximum of 1,833.
In the graph, we can see that gold has formed a double top (technical reversal pattern). If in the next few hours, it reaches this area of 1,823, a triple top could be confirmed and we could expect a technical correction towards the 21 SMA in 1,808.
On the other hand, if in the next few hours, gold falls below 1,812, it is likely that there will be a slowdown in the bullish force and the price could reach the area of 1,808. A daily close below this level could mean a bearish movement and the price could reach 1,785 and drop even towards 5/8 Murray at 1,781.
The XAU/USD pair is likely to consolidate below 1,824 and above 1,808 in the next few hours. This range zone could define our next moves to buy or sell. Only daily close below the 21 SMA could mean a bearish acceleration and will be the key to sell in the next few days with targets at 1,775 (200 EMA).
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