The XAUUSD continued its losses last week, topped at the 1205 levels and bottomed at the 1162 levels. This development leaves the pair targeting the 1142 levels, a halt is very likely and bottoming may occur here, however; sustained breakout – weekly closing – below the 1142 level will extend losses towards the 1120 levels, a cut through the 1120 levels will pave the way towards the 1090 levels.
On the upside, resistance comes at the 1205 levels , a clear break above the 1205 levels will recapture main resistance at the 1233 levels, a halt is very likely but a break will suggest short term bottoming and reverse risk towards the 1306 levels..
Conclusion: As long as 1205/1233 resistance holds on a weekly closing basis, medium term outlook in XAUUSD remains on the downside towards the 1142 levels, above 1233 faces a recovery risk towards the 1306 levels.
