FxWirePro: Gravestone doji at peaks of XAU/USD, more slumps on cards despite momentary gains ahead Yellen’s testimony

The yellow metal has slumped to give up last week's gains, a recent sharp jump propped up to 1200.07 (6 months highs) where it is also testing crucial resistance. That is where bears began being alert that has dropped this resistance to pull back to current levels of 1,181.00.

Thereby, "a sharp gravestone doji" has occurred yesterday at 1188.79 levels with mild divergence from the leading oscillators is observed.

On intraday terms, we believe in 21DMA's crossover 7DMA that prompts us selling signals correlating this with daily technical indications.

RSI signals overbought scenes: The pair at this psychological juncture of around $1200 testing crucial resistance, while RSI in overbought area evidences divergence to the recent rallies on daily charts (Currently, trending around 79.9083 while articulating), so we believe this indicator justifies current prices dips.

Stochastic supports bearish momentum: To substantiate these prevailing price slumps, slow stochastic curves view on daily charts signifies to remain in sync with the standpoint offered by RSI. %D line crossover above 80s which is overbought zone bolsters more selling pressures, (Currently, %D line is at 89.0865and %K at 88.8202 while articulating).

Gold futures edged lower in Europe trade on Wednesday, as investors looked ahead to testimony from Yellen later in the day for further directives on the pace of future interest rate hikes.

Yellow metal for April delivery on the Comex division of the NYME drifted down to trade at $1,181.00 a troy ounce.

We reckon that even if it makes an attempt of jump today during US sessions but bears could not resist to hold on to 1200 levels to push back it southwards at 1180 (spot) marks, slipping towards targets of 1162.22 can also not be disregarded.