Gold Price Forecast: XAU/USD eyes $1,800 and $1,806 on road to recovery – Confluence Detector
|- Gold price keeps the corrective upside intact towards $1,800.
- Omicron covid fears smash the US dollar alongside the Treasury yields.
- Gold looks to extend rebound amid renewed coronavirus fears.
Gold has staged a decent comeback, as bulls look to recapture the $1,800 mark amid a revival of the Omicron covid variant fears. A flight to safety theme remains in vogue, as investors scurry to the US Treasuries, killing the demand for the yields. The sell-off in the US rates have heavily weighed on the dollar, boosting gold’s appeal. However, should risk-aversion intensify the greenback could regain its safe-haven status, capping the gold price recovery.
Read: Gold Price Forecast: Risks remain skewed to the downside for XAU/USD as key support caves in
Gold Price: Key levels to watch
The Technical Confluences Detector shows that the gold price is extending its recovery towards $1,799-$1,800, which is the convergence of the previous day’s high and Fibonacci 23.6% one-month.
The next relevant upside barrier for gold bulls is pegged at 1,806, where the Fibonacci 38.2% one-week lies.
Further up, the pivot point one-day R2 at $1,808 will test the bearish commitment on the road to recovery.
The previous month’s high at $1,814 continues to remain on the buyers’ radars.
On the flip side, the immediate downside seems guarded by a dense cluster of healthy support levels around $1,793.
At that point, the Fibonacci 61.8% one-day coincides with the SMA50 one-day and SMA200 one-day.
The next critical cushion is seen at $1,789, which is a confluence of the Fibonacci 38.2% one-day and SMA5 one-day. Floors will then open up towards Friday’s low of $1,780.55.
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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.
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