Gold (XAU/USD) is nursing losses after three consecutive days of declines, although remains in a familiar range above $1850. The renewed concerns about a $900 billion COVID-19 relief package could likely keep gold on the back foot. US President Donald Trump asked for an amendment to the pandemic relief package.
However, broad-based US dollar retreat cushions the downside in gold. Brexit deal optimism and disappointing US Consumer Confidence data weigh negatively on the greenback. Pre-Christmas thin trading conditions will continue to play out ahead of the US economic releases.
How is gold positioned on the charts?
Gold Price Chart: Key resistances and supports
The Technical Confluences Indicator shows that the XAU/USD pair is struggling to overcome a dense cluster of resistance levels stacked up around the $1867-69 region.
That area is the confluence of the Fibonacci 38.2% one-week, SMA5 four-hour and the previous high four-hour.
A firm break above the latter could expose a minor cap at $1874, which is the convergence of the SMA5 one-day and Fibonacci 61.8% one-day.
Up next, the bulls are likely to challenge the critical barrier at $1880, the intersection of the Pivot Point one-day R1, Fibonacci 23.6% one-week and Bollinger Band four-hour Middle.
To the downside, minor support awaits at $1861, where the SMA200 one-hour coincides with SMA50 four-hour and the previous low four-hour.
The SMA10 one-day at $1856 is the next relevant downside target, below which the Pivot Point one-day S1 of $1852 could be probed.
The bears need a break below the $1850 barrier to reviving the bearish bias. The Fibonacci 61.8% one-week is aligned at that level.
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.
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.
Recommended content
Editors’ Picks
AUD/USD rises to two-day high ahead of Aussie CPI
The Aussie Dollar recorded back-to-back positive days against the US Dollar and climbed more than 0.59% on Tuesday, as the US April S&P PMIs were weaker than expected. That spurred speculations that the Federal Reserve could put rate cuts back on the table. The AUD/USD trades at 0.6488 as Wednesday’s Asian session begins.
EUR/USD now refocuses on the 200-day SMA
EUR/USD extended its positive momentum and rose above the 1.0700 yardstick, driven by the intense PMI-led retracement in the US Dollar as well as a prevailing risk-friendly environment in the FX universe.
Gold price cautious despite weaker US Dollar and falling US yields
Gold retreats modestly after failing to sustain gains despite fall in US Treasury yields, weaker US Dollar. XAU/USD struggles to capitalize following release of weaker-than-expected S&P Global PMIs, fueling speculation about potential Fed rate cuts.
Ethereum continues hinting at rally following reduced long liquidations
Ethereum has continued showing signs of a potential rally on Tuesday as most coins in the crypto market are also posting gains. This comes amid speculation of a potential decline following FTX ETH sales and normalizing ETH risk reversals.
Australia CPI Preview: Inflation set to remain above target as hopes of early interest-rate cuts fade
An Australian inflation update takes the spotlight this week ahead of critical United States macroeconomic data. The Australian Bureau of Statistics will release two different inflation gauges on Wednesday.