Early in the American session, gold (XAU/USD) is trading above the 200 EMA and within a downtrend channel formed since May 16 after reaching the high of 2,450.

Technically, gold is oversold. In the next few hours, it will likely find good support around the 200 EMA located at 2336. If this scenario occurs, gold could rebound and reach the top of the downtrend channel around 2346.

On the other hand, in case there is a sharp break below 2,336 and a consolidation below this area on the H4 chart, we could expect a further bearish movement and the price could reach the low of May 24 around 2,325. The instrument could even reach the low of May 7 at 2,303.

Our trading plan for the next few hours is to sell below 2,346 with a target at 2,300. In case gold breaks sharply the downtrend channel, we will look for opportunities to buy above 2,346, with targets at 2,364 and 2,396.