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07.02.202314:59 Forex Analysis & Reviews: Trading signal for Gold (XAU/USD) on February 7-8, 2023: buy on breakout above $1,875 (6/8 Murray- symmetrical triangle)

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Early in the American session, gold is trading around 1,867.25. We can see that it is trading within a symmetrical triangle pattern formed on February 3.

According to the 4-hour chart, gold is trading below the 21 SMA located at 1,870 and below the 6/8 Murray located at 1,875. We can see a consolidation which is likely to be a sign of a technical bounce in the next few hours.

Gold is showing oversold levels. If it consolidates above 1,870 (21 SMA), we could expect a recovery in the XAU/USD pair to the 200 EMA located at 1,905.

On the chart above we can see that on February 3, gold left a bearish gap around 1,882.49. In the event that the yellow metal trades above 1,870, it is likely to recover and cover this gap.

On the other hand, a break below the symmetrical triangle around 1,865, may push the price lower towards the daily support (D_2) located at 1,850. Around this area, we could expect a strong technical rebound and gold could return to the 1,870 and 1,900 levels.

Our trading plan for the next few hours is to buy gold if it trades above 1,870, with targets at 1,885 and 1,905. The eagle indicator is giving a positive signal and any technical rebound will be seen as a signal to buy.

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