Early in the American session, gold is trading around 2,750, within the uptrend channel, and below the 21 SMA, bouncing after having reached the low of 2,732.

Yesterday, after having reached the low of 2,790, gold made a strong technical correction. Today we observed a technical rebound. However, the instrument remains under bearish pressure. Hence, we could expect that if the metal reaches the 61.8% Fibonacci level around 2,766, it could be seen as an opportunity to resume selling.

On the other hand, in case gold breaks the inverted pennant pattern sharply, we could expect it to reach the 3/8 Murray area around 2,734. The instrument could even continue its fall next week and reach the 200 EMA around 2,673.

The key is to pay attention to the 61.8% retracement level. Below this area, the outlook will remain bearish for gold. Therefore, traders will have an opportunity to sell below this area.

Should XAU/USD bounce and consolidate above 3/8 Murray, we could look for buying opportunities with the target at 2,766 as this could confirm that a strong bottom is in place.