Gold Price Could Correct Gains, Oil Extends Rally

Key Highlights

  • Gold price is struggling to gain momentum above $1,915 and $1,920.


  • A major bullish trend line is forming with support near $1,888 on the 4-hours chart.


  • EUR/USD is trading nicely above 1.2200, oil price gained pace and it even broke $68.00.


  • The US ISM Manufacturing PMI increased from 60.7 to 61.2 in May 2021.

Gold Price Technical Analysis


After forming a base above $1,850, the gold price started another increase against the US Dollar. The price broke the key $1,880 resistance zone to move further into a positive zone.



The 4-hours chart of XAU/USD indicates that the price even broke the $1,900 resistance level. There was also a decent close above $1,880, the 100 simple moving average (red, 4-hours), and the 200 simple moving average (green, 4-hours).


It traded as high as $1,916 and it recently started a downside correction. There was a break below the $1,900 level.


However, the price is well supported above the $1,880 support. There is also a major bullish trend line forming with support near $1,888 on the same chart. If there is a break below the trend line, the price could decline towards the $1,880 support.


The next key support is near the $1,870 level and the 100 simple moving average (red, 4-hours). Any more losses could lead the price towards the $1,850 support.


On the upside, the price is likely to face sellers near the $1,915 and $1,920 levels. A break above $1,920 could set the pace for a larger increase in the coming sessions.

Fundamentally, the US Institute for Supply Management (ISM) Manufacturing Index was released yesterday by the ISM. The market was looking for stable reading at 60.7.

The actual result was better than the forecast, as the Institute for Supply Management (ISM) Manufacturing Index increased from 60.7 to 61.2.

Looking at EUR/USD, the pair is showing positive signs above 1.2200. Besides, GBP/USD corrected gains after trading to a new multi-month high at 1.4250.

Economic Releases to Watch Today

  • German Retail Sales for April 2021 (MoM) – Forecast 10.1%, versus 11.0% previous.

  • German Retail Sales for April 2021 (YoY) – Forecast -2.0%, versus 7.7% previous.


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