Gold prices ended a two-sided trading session virtually unchanged yesterday. The precious metal has recently suffer from some mild profit-taking pressure but it seems that growing concerns over a potential U.S. government shutdown is weighing on the dollar. XAU/USD is trading within the borders of the Ichimoku cloud on the M30 chart and the market is currently in the process of testing the resistance in the $1334.40-$1332.20 area.
From a chart perspective, the bulls still have the overall technical advantage. Prices are above the daily and the 4-hourly clouds, and the Chikou-span (closing price plotted 26 periods behind, brown line) is moving above prices. If the market successfully gets back above the 1334.40 level, where the Kijun-sen (twenty six-period moving average, green line) sits on the H4 chart, look for further upside with 1340/39 and 1344 as targets.
Breaking below the supportive 1326/5 area, on the other hand, could see a fall to 1321. The bears have to capture this strategic support to set sail for 1316. If this support is broken, then the market will probably continue to retreat towards the 1308 level.
