Gold Price Analysis: XAU/USD at four months lows, testing $1800

• Gold finds support, for now, at the $1800.
• US dollar remains under pressure amid risk appetite.

XAU/USD is falling for the second day in a row extending the correction from record-high levels. Recently bottomed at $1,800/oz, the lowest level since mid-July. The area around $1,800 capped the downside for now, as the bearish pressure is still elevated.

As of writing, XAU/USD stands at $1,805 down almost $70 from the level it had at the beginning of the week. Gold remains under pressure amid risk appetite, following positive news about COVID-19 vaccines and about the US presidential transition.

Also, US economic data contribute to the decline in gold. On Monday, the Markit PMI report triggered a sharp rally of the US dollar and pushed the metal under $1,850, leaving it vulnerable to more losses.

The bearish momentum remains intact on gold, but the $1,800 are might offer support; so far it held after being tested several times over the last hours. A break lower could trigger more volatility. The next strong supports might be seen at $1,785 and $1,750. On the upside, now $1,820 is the immediate resistance followed by $1,850.

Technical levels