Gold Price Analysis: XAU/USD rebounds after finding support above $1700

• Gold prices trim gains, up $20 from lows.
• XAU/USD bullish trend intact, but facing resistance at $1750/oz.

Gold prices bottomed at $1,704 on Monday, the lowest in six days, and then rebounded back to the $1,720 area. It is hovering around the mentioned level, off lows but still $10 below Friday’s close.

The decline took place as major currency pairs traded sideways, with low volatility. The equity market in the US opened sharply lower and rebounded, erasing practically all losses. The Dow Jones is falling 0.40% while the Nasdaq gains 0.32%. The rebound in equity prices weakened the US dollar and likely helped XAU/USD.

Strong resistance at $1750

The long term trend continues to point to the upside, but the area around $1750 is a substantial barrier that needs to be broken in order to clear the way to more gains.

“We think prices are more likely to make a slow grind higher but generally hold a $1,600-1,700 handle, rather than quickly spike to the $1,850-1,950 area. In turn, a global growth and EM recovery in 2021 could be what supports the next leg higher towards $2,000/oz”, explained analysts at Citibank.