The precious metal rose 0.77% on the day as the risk-off sentiment in the markets saw investors rushing to safe haven assets. Equity markets fell with the Dow Jones easing 1.6% during trading. Tech stocks fell, dragging the NASDAQ lower as more and more companies backed away from Huawei.
Is XAUUSD Turning Bearish?
The rally in the gold prices stalled at the 1285 handle as the resistance level is being tested currently. The Stochastics oscillator is pointing to a bearish divergence. This also coincides with a potential right shoulder being formed off the head and shoulders pattern. A successful retracement off the 1285 handle will see XAUUSD testing the support at 1270 which marks the neckline support. A subsequent breakdown below this level will trigger declines to the 124 – 1250 handle.