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Gold Testing its Bottom Attempt - US GDP Data Ahead

The 4H chart shows gold gold falling since late January from about 1307 down to almost 1190 a month later. 

Gold (XAU/USD) 4H Chart 2/26
(click to enlarge)

The 4H chart shows the pair forming a double bottom around 1190 and breaking above it this week. After price reached 1220, which was a previous support/resistance pivot area, it stalled. It came down after US data, which did give the USD a bump across the board. (USD/CAD Hangs on After US and Canadian Data).

The thing is, the data set was nothing that impressive so we should not jump onto USD strength just yet. For gold, if price can hold above 1200, there is still upside towards the next resistance around 1230-1235, which would be reinforced by a falling trendline. Note that the 4H RSI is holding below 60 for now, which shows that the prevailing bearish momentum is still in play. Traders have put gold at a short-term crossroad awaiting tomorrow's GDP data. 

US GDP q/q (Q4) data tomorrow should help traders navigate USD-strength/weakness. It is the preliminary estimate, which is the second reading. The first "advanced" reading came in at 2.6%, and it is expected to be revised down to 2.1%. If the reading is 2.0% or lower, we should expect the USD to stall further. However, if the reading is better than-expected and very close to 2.6% or higher, then we should expect a strong USD, and expect gold to test that 1200 handle. That scenario would signal a bearish continuation in gold, which puts 1190 in sight, with risk of breaking lower.