Gold Price Forecast: XAU/USD to extend its downward correction towards $1,800

Last week, gold settled above $1,810 and registered small weekly gains. However, FXStreet’s Eren Sengezer sees a possible correction to $1,800 as key resistance at $1,825 holds.

See – Gold Price Forecast: XAU/USD to find support from negative real yields and inflation fears – ANZ

XAU/USD to stage a technical correction in the near-term

“On Thursday, the European Central Bank (ECB) will announce its Interest Rate Decision and release the Monetary Policy Statement. However, the ECB already unveiled its revised policy strategy and the bank is unlikely to offer any fresh insights into its policy outlook.” 

“On Friday, the IHS Markit’s preliminary July Manufacturing and Services PMI figures from Germany, the euro area and the US will be looked upon for fresh impetus. Rather than the headline figures, investors are likely to pay close attention to the underlying details regarding the input price pressures.”

“Strong support seems to have formed at $1,800 (psychological level, Fibonacci 50% retracement of April-June uptrend). A daily close below that level could open the door for additional losses toward $1,790 (100-day SMA, 20-day SMA).”

“Resistances are located at $1,825 (Fibonacci 38.2% retracement, 200-day SMA), $1,834 (July 15 high, 50-day SMA) and $1,845 (static level).”