Gold (XAU/USD) prices reverse the previous day’s pullback from the highest levels since late November during early Friday.

In doing so, the yellow metal cheers consecutive third day of the downbeat US Treasury yields, as well as risk-off mood amid the market’s cautious sentiment ahead of next week’s Federal Open Market Committee (FOMC). The metal cheered the market’s optimism amid mixed US data and China’s rate cut the previous day, not to forget receding fears of the South African covid variant, namely Omicron.

While comments from US Treasury Secretary Janet Yellen triggered the latest risk-off mood, by fueling hawkish Fed concerns, a lack of major data/events may restrict the gold prices during the day. However, fears of the US Fed policymakers’ faster rate hike signals may challenge the precious metal buyers if the US dollar keeps the latest rebound.

Read: Fed Preview: Three ways Powell could out-dove markets, dealing a blow to the dollar

Gold Price: Key levels to watch

The Technical Confluences Detector shows that the gold price is battling the key hurdle around $1,842 comprising a cluster of SMA10 four-hour, Fibonacci 38.2% one-day and Bollinger Band Upper on the daily formation.

It’s worth noting that the ability to reverse the previous pullback from a multi-day high, as well as staying above key levels, keeps gold buyers hopeful.

Should the bulls get a bit more support from softer USD and yields, they can easily cross the $1,842 hurdle, which in turn will allow them to aim for the $1,856 hurdle comprising Fibonacci 161.8% on one-day and Pivot Point R1 on one month.

During the rise, Pivot Point R2 on weekly may offer an intermediate halt of around $1,852.

Alternatively, if the downside pressure again intensifies, then bears could challenge critical support at $1,831, encompassing the previous month’s high.

Given the gold seller’s ability to conquer the $1,831 support, a downward trajectory towards the $1,821 mark, which is the intersection of the SMA10 one-day and Fibonacci 23.6% one-week, can’t be ruled out.

Here is how it looks on the tool

fxsoriginal

About Technical Confluences Detector

The TCD (Technical Confluences Detector) 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.  If you are a short-term trader, you will find entry points for counter-trend strategies and hunt a few points at a time. If you are a medium-to-long-term trader, this tool will allow you to know in advance the price levels where a medium-to-long-term trend may stop and rest, where to unwind positions, or where to increase your position size.

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.

Feed news Join Telegram

Recommended content


Recommended content

Editors’ Picks

EUR/USD steadies near 1.0550, looks to post modest weekly gains

EUR/USD steadies near 1.0550, looks to post modest weekly gains

EUR/USD has lost its bullish momentum after having climbed above 1.0570 with the initial reaction to the US data in the American session and retreated toward the mid-1.0500s. On a weekly basis, the pair remains on track to close in positive territory. 

EUR/USD News

GBP/USD struggles to hold above 1.2300

GBP/USD struggles to hold above 1.2300

GBP/USD has edged lower following a jump above 1.2300 in the early American session on Friday. The market mood remains upbeat ahead of the weekend with Wall Street's main indexes posting strong daily gains on upbeat US data. 

GBP/USD News

Gold stays below $1,830 as US yields edge higher

Gold stays below $1,830 as US yields edge higher

Gold continues to fluctuate below $1,830 on Friday and looks to close the second straight week in negative territory. Fueled by the risk-positive market environment, the benchmark 10-year US Treasury bond yield is up more than 1% on the day, limiting XAU/USD's upside.

Gold News

Why Cardano could surprise over the weekend

Why Cardano could surprise over the weekend

ADA  set to close out the week with a gain on the workday trading week and over the weekend? Central banks signaled that the rate hike cycle is ending, meaning less stress and tight conditions for trading, opening up room for some upside potential with Cardano set to pop above $0.55 and test a significant cap.

Read more

FXStreet Premium users exceed expectations

FXStreet Premium users exceed expectations

Tap into our 20 years Forex trading experience and get ahead of the markets. Maximize our actionable content, be part of our community, and chat with our experts. Join FXStreet Premium today!

BECOME PREMIUM

Forex MAJORS

Cryptocurrencies

Signatures