Gold Price Analysis: XAU/USD keeps $1900 in sight while above key $1871 cap – Confluence Detector


Gold price retested three-month highs of $1890, although settled the week near $1880 levels, registering the third straight week of gains. Gold price remained undeterred by the FOMC minutes, which offered subtlest hints on tapering, as growing inflation risks continued to support the traditional inflation hedge. Further, persistent weakness in the US dollar and the Treasury yields, amid expectations of a faster vaccine-driven global economic recovery, also benefited gold. Additionally, the brutal crypto market crash helped keep the sentiment buoyed around the safe-haven gold.

Heading into a fresh week, the inflation narrative will continue to have a significant impact on gold trades. Meanwhile, Fedspeak, US Preliminary GDP and Consumer Durable Goods data could offer some fresh trading insights.  

Read: Gold is stable and strong in the face of crypto goofiness

Gold Price: Key levels to watch

The Technical Confluences Detector shows that gold price remains stuck between two key barriers on either side, following the weekly close at $1881.

To the downside, immediate support is seen at $1879, the confluence of the Fibonacci 61.8% one-day and Fibonacci 23.6% one-week and SMA5 four-hour.

A powerful cushion at $1871 could likely limit any retracement from higher levels. That support is the convergence of the previous day low, pivot point one-day S1 and Fibonacci 38.2% one-week.

Acceptance below the latter could trigger a drop towards $1858, where the Fibonacci 161.8% one-day coincides with the Fibonacci 61.8% one-week.

Alternatively, if the intersection of the previous high four-hour and Fibonacci 38.2% one-day at $1883 is taken out, gold price could target the next upside barrier at $1890.

At that point, the previous week high, previous day high and pivot point one-day R1 meet.

Further north, fierce resistance at $1900 is likely to challenge the bullish traders. That is the convergence of the pivot point one-month R3, pivot point one-week R1 and pivot point one-day R2.

Here is how it looks on the tool       

fxsoriginal

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.  If you are a short-term trader, you will find entry points for counter-trend strategies and hunt a few points at a time. If you are a medium-to-long-term trader, this tool will allow you to know in advance the price levels where a medium-to-long-term trend may stop and rest, where to unwind positions, or where to increase your position size.

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. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD trades below 1.1300 after German inflation data

EUR/USD continues to trade in the negative territory below 1.1300 as the American session gets underway. The data from Germany showed on Friday that the Harmonized Index of Consumer Prices, the ECB's preferred gauge of inflation, climbed to 6% on a yearly basis in November, compared to the market expectation of 5.4%.

EUR/USD News

GBP/USD extends slump below the 1.3300 mark

GBP/USD trades near its 2021 low in the 1.3290 region, as demand for the greenback picked up pace during US trading hours. Market participants are digesting the latest covid-related news, somehow less concerned about its effects on economic developments. 

GBP/USD News

Gold: En route to challenge the November monthly low

Spot gold gapped lower at the weekly opening. Concerns related to the new coronavirus variant named Omicron hit hard the markets on Friday, although thinned conditions may have exacerbated the reaction to the news, as the US celebrated Thanksgiving on Thursday.

Gold News

Ethereum breaks out of bullish pennant, targets new all-time high at $5,000

Ethereum price lost 14% of its market value in turmoil on Friday. ETH is on the path to recovery with a bullish break out of the pennant. Expect a rally to emerge as tailwinds attribute to new all-time highs.

Read more

Cyber Monday 2021 Discounts!

Glued to your trading screen on Cyber Monday? Upgrade your skills by signing up for FXStreet’s Premium service, offered at a discount of up to 50%. Fellow traders have already taken advantage of Black Friday profits. What about you? 

Subscribe now!

Forex MAJORS

Cryptocurrencies

Signatures