Gold: Healthy correction after reaching all-time highs near $1950

Gold (XAU/USD) kicked-off the Fed week with a bang, hitting a fresh life-time high at $1944.76. Stops got likely triggered on a break above the previous record high of $1921.14, which called for a quick $25 rally. Oversold daily RSI calls for a correction in the near-term but buyers still remain hopeful ahead of US Durable Goods data, FXStreet’s Dhwani Mehta briefs.

Key quotes

“The yellow metal is expected to take cues from the sentiment on the global stocks and US dollar price-action ahead of fresh virus stats and Durable Good Orders release due out from the US. Also, the US stimulus progress will be closely followed ahead of the Fed monetary policy decision due later on Wednesday.”

“The price quickly pulled back after reaching all-time highs, thanks to the oversold RSI conditions. The RSI inches higher at 86 levels, calling for a further retracement.”

The price could test the previous record high at $1921.14 on its move lower. The next downside target is seen at $1906.68, Friday’s high. The daily low and the round number of $1900 will be the level to beat for the bears.

“The bullish momentum will now regain momentum only on a break above the $1950 psychological level if the buyers surpass the latest record high. Gold bulls have the $2000 mark on their radar, which will emerge as a big milestone in the history of gold trading.”