Gold Price Analysis: Comeback on the cards as path of least resistance is up – Confluence Detector
The spread of coronavirus has weighed heavily on stock markets and sent investors to safe havens. However, after a few days of gains, the yen has returned to dominate safe-haven flows and the precious metal is falling. However, XAU/USD may begin moving up.
The Technical Confluences Indicator is showing that Gold's most significant cluster of lines is below it, while resistance is weaker. Considerable support awaits at $1,627, which is the convergence of the Pivot Point one'month Resistance 1, the previous 1h'low, and the Bollinger Band 1h-Lower.
Another cushion awaits at $1,633, which is the meeting point of the Simple Moving Average 200-1h and the Fibonacci 23.6% one-week.
Resistance is at $1,641, the confluence of the SMA 5-4h, the SMA 5-one-day, and the previous 1h-high.
Close by, $1,645 is a juncture of lines including the Fibonacci 61.8% one-day, the BB 4h-Middle, and the SMA 50-1h.
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.
