Gold Price Analysis: XAU/USD eyes $1764-$1760 support area ahead of Fed – Confluence Detector

Dhwani Mehta FXStreet

Gold (XAU/USD) is licking its wound below $1800 after extending losses into the second straight session, with all eyes on the Fed's decision for fresh direction. The Fed is expected to stand pat on its monetary policy, although it could acknowledge improving economic outlook amid successful vaccination campaigns.

Gold fell on Tuesday as the US Treasury yields firmed up after consumer confidence jumped to a 14-month high in April. Meanwhile, signs of life seen in the US dollar across the board also likely weighed on the metal.

How is gold positioned technically ahead of the Fed verdict?

Gold Price Chart: Key resistance and support levels

The Technical Confluences Detector shows that gold looks to trade in the recent trading range, with risks skewed to the downside ahead of the Fed event, amid a bunch of healthy resistance levels stacked up.

Immediate resistance awaits at $1773-$1774, the confluence of the SMA10 one-day and pivot point one-day S1.

The next upside target is seen at $1777, the intersection of the previous high four-hour, Fibonacci 61.8% one-week and Fibonacci 23.6% one-day.

Powerful resistance at 1780, which is the convergence of the SMA200 one-hour, SMA50 four-hour and Fibonacci 38.2% one-day, will be a tough nut to crack for the XAU bulls.

Alternatively, the pivot point one-day S2 at $1766 is the next support area, below which the previous week low of $1764 will get tested.

The confluence of the previous month high, SMA100 four-hour and pivot point one-week S1 could offer strong support to the buyers.

Here is how it looks on the tool

About Technical Confluences Detector

The TCD (Technical Confluences Detector) 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.

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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