Gold Price Analysis: XAU/USD to face an uphill task, with eyes on $1969 – Confluence Detector
Gold (XAU/USD) is wavering in a familiar range around $1950, looking for a strong catalyst for a range break out. The US dollar weakness amid US fiscal impasse and concerns over the economic recovery underpin the metal.
Meanwhile, the US-China tensions and correction in the US equities also buoy the sentiment around the safe-haven. However, the Fed’s reluctance to further stimulus has limited the gold’s attempts on the upside. How is gold positioned technically ahead of the Fed Chair Powell’s multiple appearances this week?
Gold: Key resistances and supports
The Technical Confluence tool shows that gold failed to hold onto the significant resistance at $1954, which is the SMA5 one-hour and Bollinger Band four-hour Middle.
Therefore, to the downside, the spot could find dense support around $1947-$1945 levels, where the Fibonacci 38.2% one-month coincide with SMA10 one-day.
A fresh sell-off could be triggered below the latter, opening floors for a test of the previous week low of $1932.
Alternatively, recapturing of the critical barrier at $1954 could call for a test of the next upside barrier at $1958, the confluence of the SMA200 four-hour and Fibonacci 38.2% one-week.
Further north, Friday’s high at $1961 could be tested, exposing the powerful $1969 hurdle, the pivot point one-day R2.
Here is how it looks on the tool
About the 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.
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.
