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FX.co ★ Trading Signal for Gold (XAU/USD) on November 21-22, 2022: sell below $1,760 (21 SMA - rebound)

Trading Signal for Gold (XAU/USD) on November 21-22, 2022: sell below $1,760 (21 SMA - rebound)

Trading Signal for Gold (XAU/USD) on November 21-22, 2022: sell below $1,760 (21 SMA - rebound)

Early in the American session, Gold (XAU/USD) is trading around 1,741, inside a downtrend channel which has been developing since November 14, and below the 21 SMA located at 1,760.

Since it reached the +1/8 zone of Murray located at 1,781, gold has tried to break this zone on several occasions and since then has started a strong technical correction. A bounce might occur in the next few hours because the price has bottomed out in the downtrend channel, hence, it could reach the zone of 8/8 Murray at 1,750.

A break of the support of the bearish channel below 1,735 is likely to open the doors for a fall towards 1,718 (7/8 Murray) and even towards the 200 EMA (1,702). The key will be to watch 1,735. This area is the convergence of daily S2 support and weekly S1 support.

On the other hand, the immediate resistance is seen on the 4-hour chart at the 21 SMA (1,760) and the 8/8 Murray around 1,850. A pullback into this zone will be seen as an opportunity to sell with short-term targets at the psychological 1,700 level.

A trade above the 21 SMA and a sharp break of the downtrend channel formed since early November could be the start of a change of scenery and gold could resume its bullish cycle. In case gold returns above 1,760, the price could rise towards the strong resistance of 1,781. The break of this resistance will facilitate the rise towards the psychological level of 1,800 and finally reach +2/8 Murray located at 1,812.

Our trading plan for the next few hours is to wait for a pullback of around 1,760 to 1,750 to sell, with targets at 1,735 and 1,702. The eagle indicator is giving a negative signal which supports our bearish strategy.

*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade
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