Gold Price Analysis: Breaking above $1,692 critical for next coronavirus-correlated bullish run – Confluence Detector
The price of Gold closed the week at just under $1,674 in a turbulent week that saw a rush into the safe-haven asset. Coronavirus continues spreading around the world with more infections in the US, South Korea, Iran, and across Europe. Investors are traders are gearing up to the open of Asian markets early on March 9. How is XAU/USD positioned?
The Technical Confluences Indicator is showing that significant resistance awaits at $1,689, which is the previous month's high.
However, another hurdle awaits the precious metal at $1,692 which could prove critical to an upside move. At that point, the Bollinger Band 4h-Upper, the BB 1h-Upper, and the previous daily high converge.
If XAU/USD manages to convincingly break above this level, the upside target is $1,720, which is the 161.8% upside extension.
Immediate support awaits at $1,673 which is the confluence of the Simple Moving Average 5-1h and the Fibonacci 38.2% one-day.
The next cushion is at $1,665, which is the convergence of the Fibonacci 23.6% one-week, and the previous 4h-low.
The strongest support line awaits at $1,662, where the Pivot Point one-month Resistance 1, the SMA 50-1h, and the Fibonacci 61.8% one-day all meet up.
More: Gold Price Forecast: Logs Biggest Weekly Gain Since February 2016, focus on coronavirus-related developments
Here is how it looks on the tool:
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.
This tool assigns a certain amount of “weight” to each indicator, and this “weight” can influence adjacents price levels. These weightings mean that one price level without any indicator or moving average but under the influence of two “strongly weighted” levels accumulate more resistance than their neighbors. In these cases, the tool signals resistance in apparently empty areas.
Author
Yohay Elam
FXStreet
Yohay is in Forex since 2008 when he founded Forex Crunch, a blog crafted in his free time that turned into a fully-fledged currency website later sold to Finixio.
