Gold Price Analysis: Path of least resistance is down after NFP, US-Sino sparks – Confluence Detector
|Gold has been mixed after the US reported an increase of 1.763 million jobs in July, better than expected but pointing to a deceleration in the recovery of the labor market. While analysts were trying to digest the figures, Bloomberg reported that the US is set to sanction Carrie Lam, Hong Kong's leader.
The news sent the safe-haven dollar higher, pushing down everything else, including the yellow metal. The escalation joins steps already announced by President Donald Trump against TikTok and WeChat – two Chinese tech titans. Beijing has already released a thinly veiled threat to undo the trade deal – scaring markets.
How is XAU/USD technically positioned?
The Technical Confluences Indicator is showing that noteworthy support awaits at $2,057, which is the convergence of the Bollinger Band 15min-Middle, the Simple Moving Average 5-1h, and the Fibonacci 38.2% one-day.
Robust resistance is at $2,062, which is a juncture of the SMA 5-4h, the Fibonacci 23.6% one-day, the BB 1h-Middle, and the previous 1h-high.
Support is weaker than resistance – pointing to weakness. The first considerable cushion is at $2,038, which is where the Pivot Point one-week Resistance 2 hits teh price.
The downside target is $2,020, where the PP one-day Support 2 awaits.
While fundamentals could continue supporting the precious metal, short-term technicals are pointing to further losses.
Key XAU/USD resistances and supports
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.
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