Gold Price Analysis: XAU/USD faces uphill battle after tumbling under $1,800 – Confluence Detector
|Is more fiscal stimulus good for gold? That used to be the narrative in 2020, but 2021 is already different. The new narrative is that massive government spending will cause inflation, and that is pushing bond yields higher. Contrary to Treasuries, the precious metal has no returns, and thus it is less attractive.
Will XAU/USD continue falling? The charts seem to favor bears. Here are the levels to watch.
The Technical Confluences Indicator is showing that gold faces fierce resistance at $1,803, which is the convergence of the Bollinger Band one-day Lower, the Pivot Point one-day Support, and the previous monthly low.
Another cap awaits at $1,821, which is a dense cluster consisting of the Simple Moving Average 5-4h, the SMA 10-4h, the Fibonacci 38.2% one-day, the BB 1h-Middle, and the SMA 200-15m.
Some support awaits at $1,776, which is where the Pivot Point one-month Support 1 and the Fibonacci 161.8% one-week meet up.
XAU/USD resistance and support levels
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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