Gold Price Analysis: XAU/USD eyes $1876 but needs acceptance above critical $1863 cap – Confluence Detector

Gold (XAU/USD) is consolidating Tuesday’s rebound above $1850, gathering pace for the next leg higher. The US dollar’s decline alongside the Treasury yields is keeping the XAU buyers hopeful amid expectations of a multitrillion-dollar stimulus likely to be announced by President-elect Joe Biden on Thursday.

Investors rethink about the recent rally in Treasury yields against the Fed’s tapering talks and growing covid cases. Focus shifts to the US CPI report due later on Wednesday for fresh cues.

How is gold positioned on the charts?

Gold Price Chart: Key resistances and supports

The Technical Confluences Indicator shows that gold continues to face strong offers around $1863, the convergence of the SMA200 four-hour, SMA5 15-minutes and Bollinger Band four-hour Middle.

A sustained break above that level is needed to take on the next barrier aligned at $1869, which is the confluence of the pivot point one-day R1 and SMA50 one-day.

Further north, the Fibonacci 23.6 one-month at $1876 could cap the advances. However, powerful resistance at $1879 will be a tough nut to crack for the XAU bulls.

Alternatively, immediate support awaits at $$1856, the Fibonacci 38.2% one-month, below which $1853 could be challenged. That level is the intersection of the previous low on four-hour, SMA10 one-hour and Bollinger Band 15-minutes Lower.

Sellers would then target the critical cushion at $1842, where the SMA200 one-day coincides with the pivot point one-day S1.

The last line of defense for the buyers is seen at the previous day low of $1837.

Here is how it looks on the tool


About 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

EUR/USD hits fresh one-month low amid souring market mood

EUR/USD has been extending its falls and dips below 1.21 as US retail sales badly disappointed and the worsening mood is supporting the safe-haven dollar. Markets digest Biden's stimulus plan. US Consumer Sentiment declined to 59.2 points. 


GBP/USD retreats toward 1.36 amid fresh dollar strength

GBP/US has pared its gains and falls toward 1.36 as the dollar gains ground. The UK economy shrank by 2.6% in November, better than estimated. The UK is ramping up its vaccination campaign and PM Johnson is pressured to ease the lockdown. 


Gold extends sideways grind near $1,850

The XAU/USD pair registered small daily gains on Thursday but struggled to extend its recovery amid a lack of significant fundamental drivers on Friday. As of writing, the pair was up 0.15% on a daily basis at $1,849.

Gold news

Forex Today: Markets “sell the fact” on Biden's stimulus, dollar rises, retail sales eyed

Markets are on the back foot after Biden hinted about tax hikes while introducing stimulus. The safe-haven dollar is edging higher despite Powell's pledge to keep monetary policy accommodative. 

Read more

DXY breaks above key downtrend, eyes move above 91.00

USD has been strongly supported on what has shaped up to be a very much risk off final trading day of the week. Most G10/USD pairs have seen significant weakness, aside from CHF/USD and JPY/USD, given that the two currencies are also considered “safe havens”.

US Dollar Index News