Gold (XAU/USD) consolidates Wednesday’s rebound, as the bulls take a breather heading into the European Central Bank (ECB) monetary policy decision. The dollar took a hit following a bounce in the Wall Street indices, fuelled by the tech rally.
The yellow metal also cheered the optimism over the US stimulus deal after the Senate Republicans proposed a smaller relief package. All eyes remain on the crucial ECB policy decision for any dovish stance, which could boost the yieldless gold. How is it positioned on the charts?
Gold: Key resistances and supports
Having faced rejection above $1950, gold has returned to the critical $1945 level, a cluster of healthy support levels, including the Fibonacci 38.2% one-month, SMA10 one-day and SMA100 four-hour.
To the upside, the immediate cap awaits at $1950, the previous day high, above which the bulls could eye the pivot point one-day R1 at $1959.
The next upside barrier is aligned at $1964, the Fibonacci 61.8% one-week while the pivot point one-day R2 at $1970 will be the level to beat for the XAU bulls.
On the flip side, the convergence of the Fibonacci 38.2% one-day and SMA100 on 15-minutes could cushion the downside.
Should the selling pressure accelerate, the next support at $1934 will be tested. That level is the intersection of the Fibonacci 23.6% one-week and SMA5 one-day.
Minor support around $1930 will come into play next, which is the Fibonacci 61.8% one-day. The previous day low of $1920 will then be tested by the sellers.
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