- Gold Price turned lower for the third straight day and refreshed YTD low on Wednesday.
- The USD gained strong follow-through traction and continued weighing on the commodity.
- Recession fears failed to lend support, though losses remain limited ahead of FOMC minutes.
Gold Price met with a fresh supply near the $1,773 region on Wednesday and drifted in negative territory for the third successive day. The intraday decline dragged the XAUUSD to a fresh YTD low, around the $1,760-$1,759 area during the early North American session and was sponsored by strong follow-through US dollar buying. In fact, the USD Index built on the previous day's blowout rally and surged to a fresh two-decade high amid aggressive Fed rate hike bets, which, in turn, undermined the dollar-denominated commodity. Bulls, so far, have failed to gain any respite from the prevalent risk-off environment, which tends to benefit the safe-haven precious metal. This, in turn, suggests that the path of least resistance for the yellow metal is to the downside.
Gold Price: Key levels to watch
The Technical Confluence Detector shows that the next relevant support for Gold Price is pegged near the $1,754-$1,753 region - Pivot Point One Month S2. This is closely followed by support near the $1,750 area - Pivot Point One Day S1. Failure to defend the said support levels would be seen as a fresh trigger for bearish traders and pave the way for a further near-term depreciating move.
On the flip side, the $1,765 region - the convergence of Previous Low One Day, Bollinger Band 15 Minutes Middle and SMA 5 One Hour - now seems to act as immediate resistance. Sustained strength beyond could trigger a short-covering move and lift Gold Price to the $1,780-$1,783 region - Pivot Point One Month S1, Bollinger Band One Day Lower and the Fibonacci 38.2% One Day.
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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.
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