Prior to the opening of the American session, the XAU/USD pair is trading just above the 21 SMA on 4H charts and forming a symmetrical triangle pattern, and below the strong resistance of 7/8 of Murray located at 1843.

This 7/8 level of Murray on daily charts is located at the EMA of 200. It also adds strength to the resistance. If the triangle breaks below 1830, there could be a fall to 6/8 of Murray located in 1812. On the contrary, a consolidation above 1835 could again be an attempt to break the resistance of 1843.

Yesterday, gold fell sharply to the 1820 zone but managed to rebound amid the decline in US Treasuries after yesterday's rise when the 10-year rate reached 1.63%.

The inflation data will be published in the US. The consumer price index is expected to have risen 0.2% in April, and 3.6% from a year ago. These figures can have an impact on the market.

The technical reading of the eagle indicator shows that gold is facing a probability of a downward correction, as the signal has touched 95 points. It is now moving away from that level, which means that there could be a fall in gold for the next few hours.

Our recommendation is to sell below the lower line of the symmetrical triangle, below 1830, with targets in 1812, and if this level is broken, we expect a rebound at the strong support at 1796, which coincides with the uptrend channel.

Support and Resistance Levels for May 11 - 12, 2021

Resistance (3) 1,856

Resistance (2) 1,849

Resistance (1) 1,846

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Support (1) 1.2143

Support (2) 1.2109

Support (3) 1.2092

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Trading tip for Gold for May 12 - 13, 2021

Sell below 1830, with take profit at 1812 (6/8 of murray) and 1796 (uptrend line), stop loss above 1837.