Gold Price Analysis: Acceptance above $1821 is critical for further upside – Confluence Detector
|Gold flirts with the critical $1821 barrier, hovering near nine-year highs. The XAU bulls remain poised to extend the upbeat momentum in the day ahead. Let’s see how it is positioned technically.
According to the Technical Confluences Indicator, the bright metal needs a convincing break the powerful barrier at $1821, the confluence of the multi-year high, pivot point one-month R1 and Bollinger Band one-hour Upper.
Acceptance above that level will open doors towards a test of the minor hurdle at $1830, the pivot point one-week R2.
Alternatively, plenty of healthy supports will limit the corrective declines, with the immediate cushion seen at $1815.50, which is the convergence of the Fibonacci 61.8% one-day and previous week high.
The next downside target is aligned around $1808, where the Fibonacci 23.6% one-week, SMA5 one-day and pivot point one-day S1 coincide.
Further south, the critical support at $1806 will be a tough nut to crack for the sellers. That level is the intersection of the Fibonacci 38.2% one-week, SMA10 one-day and previous day low.
Here is how it looks on the tool
Confluence Detector
The Confluence Detector finds exciting opportunities using Technical Confluences. The TC is a tool to locate and point out those price levels where there is a congestion of indicators, moving averages, Fibonacci levels, Pivot Points, etc. Knowing where these congestion points are located is very useful for the trader, and can be used as a basis for different strategies.
This tool assigns a certain amount of “weight” to each indicator, and this “weight” can influence adjacents price levels. These weightings mean that one price level without any indicator or moving average but under the influence of two “strongly weighted” levels accumulate more resistance than their neighbors. In these cases, the tool signals resistance in apparently empty areas.
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