Gold Price Analysis: XAU/USD’s weekly close above $1928 exposes next two key levels – Confluence Detector

Dhwani Mehta FXStreet

Gold (XAU/USD) settled the past week at two-week highs of $1930.60, having recorded the second straight weekly gain. The yellow metal tracked the rally in stocks amid a broad US dollar sell-off, induced by the increased expectations of the US policymakers agreeing on a comprehensive fiscal stimulus deal.

Heading into a fresh week, gold traders will continue to closely follow the developments concerning the multi-trillion-dollar aid package alongside the US inflation, consumer spending data and Fedspeak for fresh direction on the prices.

From a technical perspective, let’s see how gold is positioned, especially in the wake of the bullish breakout.

Gold: Key resistances and supports

Gold gave a weekly closing above the critical $1928 level on Friday, opening doors for the further upside.

The Technical Confluences Indicator suggests that the XAU bulls need a break above the immediate hurdle at $1931, the previous day high, for the next leg higher.

Strong cap at $1938 will be next on the buyers’ radar. That level is the Fibonacci 61.8% one-month.

Further, the pivot point one-week R1 lies at $1950, which could be the level to beat for the bulls.

On the flip side, powerful support awaits at $1918, the confluence of the Fibonacci 38.2% one-day and Fibonacci 23.6% one-week.

The next soft cap is seen at $1912 (SMA100 15-minutes), below which the robust support at $1910 could be put at risk. At the latter, the Fibonacci 38.2% one-week and SMA10 four-hour coincide.

Here is how it looks on the tool

About Confluence Detector

The Confluence Detector finds exciting opportunities using Technical Confluences. The TC 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.

EUR/USD appears supported by the 200-day SMA, for now

Following an early pullback to multi-week lows near 1.1670, EUR/USD now manages to reclaim the 1.1700 region as the NA session draws to a close on Monday. The steep retracement in spot follows the equally strong move higher in the US Dollar, as investors continue to assess the geopolitical landscape in the wake of the US and Israel attacks on Iran.

GBP/USD hits new yearly lows near 1.3300

GBP/USD adds to the recent bearish tone, approaching to the key 1.3300 support to reach fresh YTD troughs against the backdrop of the robust performance of the US Dollar. Indeed, Cable’s decline comes amid the firm demand for the safe-haven space in the wake of the US and Israel attacks to Iran.

Gold eases some ground, approaches $5,300

Gold now surrenders part of the earlier advance, reshifting its attenton to the $5,300 zone per troy ounce at the beginning of the week. Indeed, the yellow metal’s firm performance appears propped up by incresing geopolitical jitters in the Middle East, which at the same time fuels the demand for the safe-haven space.