Spot gold (XAU/USD) is testing the higher limits of its latest downtrend!

Will the valuable metallic carry on dropping pips towards the U.S. greenback?

Or will we see a breakout this week?

Gold (XAU/USD) 4-hour Chart by TV

For those who’ve been watching spot gold these days, you then’ll know that XAU/USD has been making decrease highs and decrease lows since Could when the pair discovered resistance on the $2,040 space.

XAU/USD’s downtrend has taken it has far as $1,900 nevertheless it seems to be like there have been sufficient patrons on the space to encourage a primary contact bounce.

Will XAU/USD retest its $1,900 lows?

The pair is at present knocking on the $1,930 ranges, which isn’t too removed from the highest of a descending channel and 200 SMA on the 4-hour time-frame. What’s extra, XAU/USD’s present ranges are additionally close to the 50% Fibonacci retracement of June’s downswing!

A brief commerce on the $1,930 – $1,940 zone would yield a superb threat ratio particularly if XAU/USD makes new July lows under $1,900 with out going previous the 200 SMA.

The $1,900 earlier low is an effective preliminary goal, however you too can intention for brand new month-to-month lows if there’s sufficient bearish momentum.

Really feel like XAU/USD is sure for an upside breakout as a substitute?

You possibly can watch for a transparent break above the channel or the 200 SMA earlier than aiming for earlier areas of curiosity like $1,970 or $2,000.