Gold Price Forecast: XAU/USD bulls remain hopeful whilst above $1,710 – Confluence Detector
|- Gold price stages a comeback as the US dollar corrects amid a risk-on mood.
- Investors reposition after Powell’s speech, ahead of next week’s US inflation.
- XAU/USD looks to $1,725 and $1,734 so long as $1,710 support holds.
Gold price is attempting a rebound from the $1,700 region once again, as the US dollar resumes its correction from two-decade highs amid the return of risk-on flows. The US Treasury yields take a breather but hold near multi-year high, as Fed Chair Jerome Powell cemented a 75 bps September Fed rate hike, with markets now pricing an 85% probability. Powell maintained that the Fed remains committed to bringing inflation down while warning against prematurely loosening policy during a Q&A presented by the Cato Institute on Thursday. The end-of-the-week flows and the market’s position readjustments ahead of next week’s US inflation data also offer a fresh boost to the yellow metal.
Also read: Gold Price Forecast: Will XAU/USD confirm a falling channel breakout?
Gold Price: Key levels to watch
The Technical Confluence Detector shows that the gold price is looking to continue with its recovery mode, eyeing the powerful resistance at $1,725, which is the Fibonacci 61.8% one-week.
Bulls will then challenge the previous day’s high of $11,728, above which a fresh upswing toward the Fibonacci 23.6% one-month at $1,734 will be on the cards.
On the flip side, the Fibonacci 61.8% one-day at $1,719 offers immediate support, below which sellers will target strong support around the $1,715, which is the convergence of the Fibonacci 38.2% one-day and SMA10 four-hour.
The next critical support is seen at the confluence of the Fibonacci 38.2% one-week, SMA5 one-day and the previous month’s low at $1,710.
A sustained move below the latter will open a fresh downside towards the previous day’s low of $1,704.
Here is how it looks on the tool
About Technical Confluences Detector
The TCD (Technical Confluences Detector) 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. If you are a short-term trader, you will find entry points for counter-trend strategies and hunt a few points at a time. If you are a medium-to-long-term trader, this tool will allow you to know in advance the price levels where a medium-to-long-term trend may stop and rest, where to unwind positions, or where to increase your position size.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.