Trading Signals for GOLD sell below $2,809 or buy above $2,824

Early in the American session, XAU/USD is trading around $2,819, above the 21 SMA, and below the 8/8 Murray. A strong technical bounce is observed and gold is likely to continue rising in the next few hours until it reaches the 2,822 area where the daily R_2 is located.

If gold reaches its annual high ( 2,822-2,828), a double-top pattern will be formed which could be seen as a technical reversal signal. Thus, we could sell the metal in the short term with the target at $2,600.

On the other hand, if gold consolidates above 2,820, the outlook could remain bullish. Hence, we could expect gold to reach +1/8 of Murray located at 2,851.

Technically, we could expect gold to make a strong technical correction because the price is approaching overbought levels on the daily and weekly charts.

The indicator is showing a negative signal, reaching overbought levels. Therefore, after a technical correction towards 2,785 (21 SMA), gold could resume its bullish cycle.