- Gold price remains stuck in a familiar range below $1,940, lacking a clear direction.
- Treasury yields firm up on hawkish Fed while the Russia-Ukraine crisis rages on.
- Gold bulls to face an uphill battle amid hawkish Fed, Ukraine saga.
Amidst the hawkish Fed’s outlook and the Russia-Ukraine stand-off, gold price is struggling to find a clear direction. The bright metal continues to gyrate in a $20 narrow range so far this week, looking for a decisive break in either direction. Fed Chair Jerome Powell remains confident on the US economy, backing a 50bps rate hike in May. The aggressive Fed’s tightening plans have pushed the US Treasury yields through the roof, capping gold’s upside. Meanwhile, increased Russian hostilities on Ukraine and a stalemate on the peace talks keep the downside cushioned in gold price.
Read: Gold Price Forecast: XAU/USD to offset Fed rate hikes by virtue of safe-haven demand – ANZ
Gold Price: Key levels to watch
The Technical Confluences Detector shows that gold price is extending declines to test the pivot point one-day S1 at $1,923.
Acceptance below that level will call on sellers to target strong support at $1,918, which is the convergence of the Fibonacci 23.6% one-week, the previous day’s low and Bollinger Band four-hour Lower.
If the sell-off intensifies, then a sharp drop towards the confluence of the SMA200 four-hour and the pivot point one-day S2 at $1,909 cannot be ruled out.
The intersection of the Fibonacci 161.8% one-day and Fibonacci 38.2% one-month at $1,904 will be a level to beat for gold bears.
Alternatively, if bulls jump back into the game, then immediate resistance is seen at $1,926, the Fibonacci 61.8% one-day.
Further up, gold bulls will need to find a strong foothold above a dense cluster of resistance levels around $1,931.
That level comprises of SMA5 one-day, SMA10 four-hour, Fibonacci 38.2% one-day and one-week.
The next powerful upside barrier is that of the Fibonacci 26.3% one-day, where the $1,936 level aligns.
The previous day’s high of $1,941 will be next on buyers’ radars on a sustained move higher.
Here is how it looks on the tool
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.
Recommended content
Editors’ Picks
EUR/USD clings to gains above 1.0750 after US data
EUR/USD manages to hold in positive territory above 1.0750 despite retreating from the fresh multi-week high it set above 1.0800 earlier in the day. The US Dollar struggles to find demand following the weaker-than-expected NFP data.
GBP/USD declines below 1.2550 following NFP-inspired upsurge
GBP/USD struggles to preserve its bullish momentum and trades below 1.2550 in the American session. Earlier in the day, the disappointing April jobs report from the US triggered a USD selloff and allowed the pair to reach multi-week highs above 1.2600.
Gold struggles to hold above $2,300 despite falling US yields
Gold stays on the back foot below $2,300 in the American session on Friday. The benchmark 10-year US Treasury bond yield stays in negative territory below 4.6% after weak US data but the improving risk mood doesn't allow XAU/USD to gain traction.
Bitcoin Weekly Forecast: Should you buy BTC here? Premium
Bitcoin (BTC) price shows signs of a potential reversal but lacks confirmation, which has divided the investor community into two – those who are buying the dips and those who are expecting a further correction.
Week ahead – BoE and RBA decisions headline a calm week
Bank of England meets on Thursday, unlikely to signal rate cuts. Reserve Bank of Australia could maintain a higher-for-longer stance. Elsewhere, Bank of Japan releases summary of opinions.