Gold Price Forecast: Holding at higher ground above $1,800

Valeria Bednarik FXStreet

XAU/USD Current price: $1,815.

Stock markets are up on Wednesday, diverging attention away from the bright metal.
US CB Consumer Confidence improved by more than anticipated in December.
XAU/USD consolidates gains in a tight intraday range, aims to extend its recent rally.

Optimistic market players maintain XAU/USD above the $1,800.00 threshold on Wednesday, with the bright metal trading near its recent multi-month high of $1,824.53 a troy ounce. The US Dollar recovered some ground throughout the first half of the day, but the advance was shallow and short-lived. Volatility declined after financial markets completed digesting the latest bout of central banks’ announcements and ahead of the year-end holiday.

At the time being, the better tone of equities maintains investors away from the bright metal. Wall Street opened in the green, accelerating its advance following the release of US CB Consumer Confidence, which jumped to 108.3 in December, well above the 101.0 expected and below the previous 100.2. The report also helped the Greenback in the near term, with XAU/USD currently trading at around $1,816 a troy ounce, unchanged for the day.

Meanwhile, US Treasury yields stand pat, hovering around Tuesday’s closing levels. The 10-year note currently yields 3.68%, while the 2-year note offers 4.23%.

XAU/USD price short-term technical outlook

The daily chart for the XAU/USD pair shows that it has lost its bullish strength, but the risk remains skewed to the upside. Gold keeps trading above all of its moving averages, while the 20 SAM crosses above the 200 SMA, converging at around $1,784.80. The Momentum indicator heads south within positive levels, resting above its 100 line, while the RSI indicator consolidates near overbought readings, suggesting absent selling interest.

In the near term, and according to the 4-hour chart, bulls also have better chances. Technical indicators have eased modestly but remain well above their midlines, with the RSI holding near overbought readings. At the same time, the 20 SMA heads firmly north above the longer ones, which also present upward slopes.

Support levels: 1,810.00 1,798.70 1,785.30

Resistance levels: 1,824.50 1,835.10 1,846.10

View Live Chart for XAU/USD

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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