Gold prices covered the entire October range in just one day and the focus is on a break of this zone for guidance as price holds just above uptrend support. These are the updated targets and invalidation levels that matter on the XAU/USD technical charts heading into the start of the week. Review my latest Strategy Webinar for an in-depth breakdown of this gold technical setup and more.

GOLD PRICE CHART - XAU/USD DAILY
Technical Outlook: “a deeper correction while below 1920 with a break below the September lows needed to fuel the next leg lower in price.” Gold broke higher days later to briefly register a high at 1965 before posting a massive outside candle (encompasses the entire October trade range) lower on news of a covid-19 vaccine last week.

The November opening-range is set and defined by the November 9th candle – look to the break for guidance. Key support rests at the 38.2% Fibonacci retracement of the yearly range / September low at 1837/48 with a break there exposing more a significant technical confluence at the 2012 high / 100% extension at 1790/1803- an region of interest for possible downside exhaustion IF reached. Daily resistance steady at 1920 backed by the August channel line – ultimately a breach / close above 1988/92 is needed to mark resumption of the broader uptrend.

GOLD TRADER SENTIMENT – XAU/USD PRICE CHART
A summary of IG Client Sentiment shows traders are net-long Gold- the ratio stands at +4.26 (80.98% of traders are long) – bearishreading

Long positions are5.45% lower than yesterday and 14.18% higher from last week

Short positions are 18.97% higher than yesterday and 18.33% higher from last week

We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests Gold prices may continue to fall. Yet traders are less net-long than yesterday and compared with last week. Recent changes in sentiment warn that the current Gold price trend may soon reverse higher despite the fact traders remain net-long.

Reference by: Michael Boutros, Technical Strategist with DailyFX