Gold Price Forecast: XAU/USD’s battle with $1800 extends, levels to watch ahead of Fed – Confluence Detector
- Gold price bounce after defending key support around $1798 once again.
- Markets remain cautious ahead of the crucial Fed decision.
- Gold bears await break below 100-day SMA at $1,796
Gold price is rising back above $1800, defending the key support area around $1798 amid a cautious market mood heading into the Fed decision. The sell-off in the Chinese stocks seems to have paused, offering some support to the Asian indices, although surging covid cases in Asia remain a drag on the investors’ sentiment. A retreat in the US Treasury yields and the risk-off mood is boding well for gold price. Meanwhile, the US dollar holds the lower ground amid downbeat US Durable Goods data and pre-Fed repositioning.
All eyes remain on the Fed decision, as markets bet on a hawkish signal from the world’s most powerful central bank. The Fed is expected to hint at a likely taper starting off from the final quarter of this year.
Gold Price: Key levels to watch
The Technical Confluences Detector shows that gold has managed to defend powerful support around $1798, which is the convergence of the Fibonacci 61.8% one-day, Fibonacci 23.6% one-week and SMA100 one-day.
Acceptance below that level could revive the bearish interests, calling for a test of the previous day’s low at $1794.
Further south, the intersection of the previous week’s low and Fibonacci 23.6% one-month at $1791 will be a tough nut to crack for gold bears.
Alternatively, if the buyers need to find a strong foothold above the key resistance at $1805 to unleash further upside. That level is the confluence of the previous day’s high and Bollinger Band one-hour Upper.
The relevant upside target appears at $1812, where the SMA10 one-day, Fibonacci 61.8% one-week and the pivot point one-day R2 merge.
The bulls will then look to take out the Fibonacci 38.2% one-month at $1814.
Despite the renewed bids, it's going to be a bumpy ride for gold bulls.
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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.