Since the opening of the trading day, the XAU/USD pair has strengthened. Precious metals prices gained support from a rise in oil prices amid the publication of Crude Oil Stock Change statistics. Yesterday, the Energy Information Administration reported a fall in US crude inventories while an increase was expected.
However, as the Fed aims at gradual tightening of monetary policy and global economic situation is set to improve, the price of gold will remain under pressure.
Support and resistance
OsMA and Stochastic on the 4-hour and daily charts recommend long positions.
On the 4-hour chart, the price has approached the resistance level of 1075.00 (ЕМА144). If the growth continues, the price might reach the levels of 1081.00 (EMA200), 1085.00 (upper border of an ascending correctional channel on the 4-hour chart) and 1088.00 (EMA50 on the daily chart).
The breakdown of the support level of 1070.00 (EMA50 on the 4-hour chart and EMA200 on the hourly chart) allows the pair to resume its downward trend.
Support levels: 1070.00, 1060.00, 1050.00.
Resistance levels: 1075.00, 1081.00, 1085.00.
Long positions can be opened above the level of 1074.20 with targets at 1079.50, 1085.70 and stop-loss at 1072.00.
Short positions can be opened below the level of 1068.00 with targets at 1064.00, 1058.90 and stop-loss at 1071.00.