Gold Price Analysis: Holding onto $1862 pivotal for sustained recovery – Confluence Detector

The optimism over US fiscal stimulus and a thaw in the US dollar’s rally helped Gold (XAU/USD) recover nearly $30 from two-month lows of $1849. Meanwhile, the yellow metal also cheered concerns about the strength of the US economic recovery, in the wake of the stubbornly high Jobless Claims.

In the day ahead, it remains to be seen if the metal sustains the pullback, as the focus shifts back to the fundamentals, with major central banks’ on-hold and the coronavirus resurgence. Let’s see how gold is positioned technically heading into the weekly closing.

Gold: Key resistances and supports

The Technical Confluence tool shows that gold is looking to test a dense cluster of resistances around $1877, which is the convergence of the previous day high and Bollinger one-day Lower.

The next resistance sits at $1881, the pivot point one-day R1. Further north, the confluence of the pivot point one-week S3 and SMA100 one-hour at $1890 could be put to test.

To the downside, a minor cushion is seen at $1871.50, where the Fibonacci 23.6% one-day intersects the previous high on four-hour.

A failure to defend the latter, the bears could try taking out the next downside target at $1868, the SMA5 four-hour and Fibonacci 38.2% one-day meeting point.

However, the last straw for the bulls remains the critical support at $1862, below which the near-term recovery momentum could fade. The level is the confluence of the previous month low, pivot point one-month S1 and SMA10 four-hour.

Thursday’s low at $1949 could be back in play should the aforesaid support give way.

Here is how it looks on the tool


About the Confluence Detector

The TCI (Technical Confluences Indicator) 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.

Learn more about Technical Confluence

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.

Feed news

Latest Forex News

Latest Forex News

Editors’ Picks

AUD/USD fuelled 0.2% by strong PMI Composite in early Asia

AUD is up on the day so far as early data gives the bulls a head start. Early Asia has been kind to Aussie bulls with the price of the currency extending its late New York gains with a robust Construction PMI report, solidly above the 50.0 expansion level, arriving at 54.2.


NZD/USD bullish bets above 0.6690 marked down by CPI miss

NZD/USD bulls have been stopped in their tracks by the miss in the CPI data. The US dollar found a lease of life on Wall Street, bulls encouraged by data. New Zealand's CPI was released in recent trade which has changed the bird's flight trajectory in early Asia.


Gold: Bears seeking a continuation below key daily support

Gold prices are back under pressure and below a critical trendline on the daily chart. The swing trading opportunities are caught up in the wash of volatility. A day trading strategy could offer an opportunity if price obeys market structure.

Gold News

2020 US Elections: The final presidential debate

The second and final presidential debate between Donald Trump and Joe Biden promises to be a political event of the first magnitude. Mr. Biden leads i

Read more

WTI bulls keep the fuell buring into Wall Street close

West Texas Intermediate crude oil is higher on the day, although has run into resistance and started to consolidate.

Oil News