Gold price has started out the first trading day of 2022 on the wrong footing. As FXStreet’s Dhwani Mehta notes, XAU/USD’s four-hour technical setup suggests an extended pullback.

XAU/USD to stay afloat above $1,820

“The retracement in gold price triggers a fresh drop towards the critical demand area around $1,814, which is the confluence of the wedge support and bullish 21-Simple Moving Average (SMA). Ahead of that level, the 1,820 round number could get tested. If gold price yields a rising wedge breakdown on the said time frame, then a sell-off could kick in towards $1,800.”

“Should the buyers regain control, the bright metal could see a retest of the multi-week highs of $1,832, above which a fresh upswing towards the November 22 highs of $1,849 cannot be ruled out.”