Gold price is struggling to find its feet below $1,940 in the European session. Gold traders turn cautious ahead of the critical US GDP release, which could have a significant impact on the market sentiment, as well as, the US Dollar valuations.
Having tested the upper boundary of a rising wedge pattern on multiple instances this week, Gold price finally broke above the latter on a daily closing basis on Wednesday. That upside hurdle is now aligned at $1,945.
The natural tendency of the rising wedge is usually to yield a downside break. Therefore, Gold buyers remain skeptical, especially awaiting the first estimate of the United States Gross Domestic Product (GDP) release.
Should the key US economic data disappoint, implying signs of slowing down in the American economy, the US Dollar could stage a solid recovery across the board. As a result, Gold price could extend its corrective downside to test the wedge support at $1,937.
Related– Gold Price Looks to Recapture $1,900
Further south, Gold sellers are expected to challenge the previous day’s low at $1,920, below which a test of the $1,900 mark will be inevitable.
Gold sellers, however, need a daily closing below the lower boundary of the rising wedge formation, now at $1,933, to confirm a downside break.
The 14-day Relative Strength Index (RSI) is back in the overbought territory, which could provide extra legs to the Gold price correction.
However, if the United States’ growth figures dismiss recession fears, which could fuel a risk rally on global markets and down the demand for the safe-haven US Dollar. In such a scenario, Gold price could see a fresh rally above the $1,950 psychological level.
The next upside target for Gold bulls is envisioned around April 20 2022 highs near $1,958. A sustained move above the latter will bring the last April high of $1,998 back into the picture.
