Gold Price Analysis: XAU/USD remains capped by $1947 ahead of Georgia race – Confluence Detector

Dhwani Mehta FXStreet

Gold (XAU/USD) holds below the critical $1947 barrier heading into Tuesday’s runoff elections in Georgia. Gold buyers remain hopeful of Democratic control of Congress, as it implies an easier path for President-elect Joe Biden to push for additional fiscal support.

An increase in inflows into gold ETFs combined with a surge in coronavirus cases-led fresh lockdowns also keeps the metal underpinned. Let’s look at the key technical levels for trading gold in the lead up to the critical Georgia vote.

Gold Price Chart: Key resistances and supports

The Technical Confluences Indicator shows that Monday’s 2% rally remains capped below the critical $1947 resistance, which is the pivot point one-month R1.

Only a sustained break above the latter could unleash the further upside, with immediate resistance aligned at $1952, the Bollinger Band four-hour Upper.

The next upside target for the buyers is seen at $1958, where the pivot point one-day R1.

Alternatively, the convergence of the Fibonacci 23.6% one-day and SMA100 15-minutes at $1935 could challenge the retracement from two-week tops.

Further south, the $1929 cushion could limit the declines. That level is the Fibonacci 38.2% one-day.

Meanwhile, strong support of the pivot point one-week R2 at $1921 will be the level to beat for the bears.

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

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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