Gold Price Analysis: XAU/USD eyes $1876 but needs acceptance above critical $1863 cap – Confluence Detector
Gold (XAU/USD) is consolidating Tuesday’s rebound above $1850, gathering pace for the next leg higher. The US dollar’s decline alongside the Treasury yields is keeping the XAU buyers hopeful amid expectations of a multitrillion-dollar stimulus likely to be announced by President-elect Joe Biden on Thursday.
Investors rethink about the recent rally in Treasury yields against the Fed’s tapering talks and growing covid cases. Focus shifts to the US CPI report due later on Wednesday for fresh cues.
Gold Price Analysis: XAU/USD raises a bear flag on the 4-hour chart
Gold is currently trading near $1,860 per ounce, representing a 0.37% gain on the day. The bounce from Monday's one-month low of $1,816 has taken the shape of a bear flag pattern on the 4-hour chart. A bear flag is a pause that often refreshes lower, recharging bears' engines for a more profound decline.
A move below the lower end of the flag, currently at $1,840, would confirm a breakdown and imply a continuation of the decline from the Jan. 6 high of $1,959. The immediate support is seen at $1,816 ad $1,800.
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