Gold Fends Off Attack on $2000, USD/CAD Sinks, GBP/USD on Cusp of Epic Breakout

Technical analysis of gold prices

Gold sold on Friday, but the bulls were able to repel an attack on the psychological level of $2,000, which allowed prices to establish a base and rise on Monday, indicating that the path of least resistance is still to the upside, with precious metals benefiting from seeing that it has been reached. to the peak Fed rate.

If XAU/USD remains in its bullish trajectory, the first barrier to watch will appear at the $2050 mark, followed by a 2023 high below $2070. Successfully clearing this technical hurdle could consolidate the bullish momentum, paving the way for a move towards the channel resistance at $2,100.

In the event of a reversal, the initial support is at $2,000, but a breakdown could attract sellers and create the right conditions for a decline towards $1,975. With further weakness, the next target on the downside is the 50-day SMA hovering around $1,958.

Gold price technical chart

Gold chart created using TradingView

Technical analysis of the USD/CAD pair

USD/CAD has completely erased the rally in the second half of April in recent days, with selling accelerating after two key levels were breached: one at 1.3500, which was created by an uptrend line that has been going on for almost a year, and the other at 1.3445, created by 200-day simple moving average.

With bears back in control of the market, traders should carefully watch technical support near the psychological level of 1.3300, which is also roughly in line with the 2023 lows. If this floor breaks, the broader outlook for USD/CAD will turn completely negative, opening the door for a slide. Towards 1.3220.

On the flip side, if the exchange rate rises and starts to rebound, the 200-day moving average should act as resistance to prevent a significant upward turn. However, if this barrier is removed, the bulls could launch an attack on the 1.3500 handle.

Technical chart of the USD/CAD pair

USD/CAD chart prepared using TradingView

Technical analysis of the GBP/USD pair

GBP/USD has been on a solid rally since early March, overwhelming the bears and pushing them steadily higher. However, prices seem to be approaching the major technical resistance near 1.2975, created by the descending trend line extending from the 2021 highs. This dynamic barrier could block the upside path for the Sterling.

To gain insight into the near-term outlook and the next directional move, traders should monitor the pair’s reaction around current levels, with two possible scenarios worth considering at this point: a break-up or a rejection-down.

Breaching the upper side of the technical resistance at 1.2675 will reinforce the positive momentum and pave the way for a rush towards 1.2765, the 61.8% Fibonacci retracement of the 2021/2022 drop. Conversely, if GBP/USD is rejected from resistance and heads south, support lies at 1.2540, followed by 1.2475.

Technical chart of the GBP/USD pair

GBP/USD chart set up using TradingView