Gold Price Forecast: XAUUSD to extend range play around $1,850 while bulls stay cautious

Gold Price clings to 21-Daily Moving Average (DMA) at $1,845 after staging a comeback from ten-day lows. As FXStreet’s Dhwani Mehta notes, XAUUSD is in search of a clear direction.

Gold is lacking the follow-through recovery momentum

“Bulls remain cautious amid resurfacing aggressive Fed rate hikes bets and ahead of the US ADP jobs data, which seen rising to 300K in May vs. 247K previous. Strong US employment numbers will add to the hawkish Fed rate hike track, which could likely bolster the dollar’s demand at gold’s expense.”

“Gold has opened Thursday above the bearish 21-DMA at $1,845, which is now acting as strong support. Bulls could take out the $1,850 hurdle should the recovery momentum extend in the sessions ahead. The next key resistance level is seen at $1,859, which is the descending trendline hurdle. A firm break above the latter will call for a retest of the previous week’s high of $1,870.”

“A breach of the 21-DMA once again will expose the 200-DMA support of $1,841, below which the previous day’s low of $1,829 will be put to test. The next downside target aligns at the $1,820 round figure before the May 19 low of $1,811 could be threatened.”