XAU/USD bulls target $1,680 – Confluence Detector

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  • The price of gold extends the rally from the beginning of the week towards a key short-term obstacle.
  • Risk sentiment weighs on DXY despite Fed hawkish bets and US inflation expectations.
  • The lack of major guidance makes it easier to extend the previous trend even as central banks, recession woes test XAU/USD.

The price of gold (XAU/USD) remains on the forefront for the second day in a row in a firmer market sentiment at the start of Tuesday. The metal’s latest rally draws hints from waning fears of a UK market crash after the UK chancellor reversed previous promises. The lack of major data/events could also favor the yellow metal, as well as hopes for further stimulus from Japan, China and the UK. It should be noted that chatter surrounding the woes of the recession in the bloc and hawkish comments from policymakers at the European Central Bank (ECB) also contributed to the latest strength in the precious metal.

Moving on, a light calendar may keep XAU/USD bulls in check given the greenback’s weakness. However, any negative surprises to the risk profile will not be taken lightly as the latest rally in prices remains uncertain, especially amid hawkish central banks and recessionary woes.

Also Read: Gold Price Prediction: XAU/USD Defends New Support at $1,644, But For How Long?

Gold price: Main levels to watch

The technical confluence detector shows that the price of gold is approaching the immediate resistance placed at $1,669, comprising the one-day midpoint of the Bollinger Band.

Following this, a convergence of the previous yearly low, 200-HMA and 61.8% Fibonacci 1-week, is a tough problem for XAU/USD buyers around $1,679.

It should be noted, however, that a clear upside break of $1,679, as well as the round figure of $1,680, will need to be validated from the mid-month high around $1,683 before leading the way. bulls towards the $1,700 threshold.

Alternatively, Fibonacci 23.6% on the week and 50-HMA offer immediate support for the metal during pullback moves around $1,655.

In a case where commodity prices fall below $1,655, the previous daily low and Fibonacci of 23.6% in one month could challenge gold bearish at around $1,643.

This is what it looks like on the tool

About the Technical Confluence Detector

The TCD (Technical Confluences Detector) is a tool for locating and signaling price levels where there is congestion of indicators, moving averages, Fibonacci levels, pivot points, etc. If you are a short-term trader, you will find entry points for countertrend strategies and chasing a few points at a time. If you are a medium-long term trader, this tool will allow you to know in advance the price levels where a medium-long term trend can stop and rest, where to unwind positions, or where to increase your post size.

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