Gold Price Analysis: XAU/USD moves back above $1840 level, two-day tops

Gold regained positive traction on Tuesday and reversed the overnight slide to near two-week lows.
The $1848-50 resistance might cap any further gains ahead of the FOMC monetary policy meeting.

Haresh Menghani FXStreet

Gold added to its intraday gains and climbed to fresh daily tops, around the $1843 region during the early European session.

The precious metal caught some fresh bids on Tuesday and built on the previous day's late bounce from near two-week lows, around the $1818 region. The continuous surge in new coronavirus cases overshadowed the recent optimism over the rollout of vaccines for the highly contagious disease, which, in turn, benefitted the commodity's safe-haven status.

Apart from this, hopes for additional US fiscal stimulus measures extended some additional support to the non-yielding yellow metal and remained supportive. Meanwhile, a subdued US dollar price action did little to influence the dollar-denominated commodity or hinder the intraday positive move, with bulls looking to build on the strength beyond 200-hour SMA.

That said, the upside is likely to remain capped near the $1848-50 region as investors might refrain from placing aggressive bets ahead of a two-day FOMC monetary policy meeting, starting this Tuesday. Hence, any subsequent move up runs the risk of fizzling out rather quickly and warrants some caution before positioning for any further appreciating move.

Market participants now look forward to the US economic docket – featuring the second-tier releases of the Empire State Manufacturing Index and Industrial Production data. This, along with the US stimulus headlines, might influence the USD price dynamics. Traders might further take cues from developments surrounding the coronavirus saga and the broader market risk sentiment.

Technical levels to watch

XAU/USD

Overview
Today last price	1841.08
Today Daily Change	12.81
Today Daily Change %	0.70
Today daily open	1828.27

Trends
Daily SMA20	1835.65
Daily SMA50	1873.27
Daily SMA100	1909.12
Daily SMA200	1810.11

Levels
Previous Daily High	1841.65
Previous Daily Low	1819.08
Previous Weekly High	1875.34
Previous Weekly Low	1822.22
Previous Monthly High	1965.58
Previous Monthly Low	1764.6
Daily Fibonacci 38.2%	1827.7
Daily Fibonacci 61.8%	1833.03
Daily Pivot Point S1	1817.68
Daily Pivot Point S2	1807.1
Daily Pivot Point S3	1795.11
Daily Pivot Point R1	1840.25
Daily Pivot Point R2	1852.24
Daily Pivot Point R3	1862.82

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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