XAU/USD has been extending its decline, trading at around $1,865 at the time of writing. Markets are becoming more concerned about the rapid spread of COVID-19 in Europe and growing in the US. While that could eventually lead to a larger fiscal stimulus from the US government, Congress has adjourned without taking any decisions.
The elections are also causing a high level of uncertainty and it could move gold in all directions.
In the meantime, how are technicals looking for XAU/USD?
The Technical Confluences Indicator is showing that gold only has weak support at $1,861, which is the meeting point of the Pivot Point one-day Support 1 and the Bollinger Band 15min-Lower.
A critical cushion awaits at $1,849, which is the convergence of the previous monthly low and the Pivot Point one-week Support 3.
Looking up, strong resistance is at $1,872, which is the confluence of the Fibonacci 161.8% one-week, the previous 4h-low, and the PP one-week Support 2.
The upside target, in case of a recovery, awaits at $1,886, which is a juncture of levels including the BB 1h-Upper and the PP one-week S1.
Key XAU/USD resistances and supports
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.
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