- Gold Price rebounds from six-day lows but buyers remain wary.
- Upbeat mood keeps USD bears in control despite a pause in the yields sell-off.
- Central banks' rate hike bets cool off amid looming recession risks.
The R-word is back on the radars, prompting markets to scale back aggressive rate hike expectations from major central banks worldwide. Cooling hawkish expectations is helping calm investors’ nerves, weighing negatively on the safe-haven US dollar at the expense of gold price. However, stabilizing US Treasury yields, following the recent retreat, are keeping the further upside elusive in the bright metal. The market’s perception of risk sentiment, in the facing of lingering inflation and recession worries will continue to drive the US dollar price action, in turn, influencing XAUUSD. Attention now turns towards next Monday’s US Durable Goods data and the ECB Forum in Sintra, where the central banks’ heads are likely to participate in a panel discussion on the monetary policy.
Gold Price: Key levels to watch
The Technical Confluence Detector shows that Gold Price is retreating after running into strong offers at $1,831, which is the intersection of the Fibonacci 38.2% one-day, SMA200 one-hour and the previous high four-hour.
The yellow metal is retracing further towards the previous day’s low of $1,823, where the Fibonacci 23.6% one-week coincides.
A breach of the latter will trigger a sharp drop for a test of the confluence of the Fibonacci 23.6% one-month and pivot point one-day S1 at $1,816.
The Bollinger Band one-day Lower at $1,812 will be the line in the sand for gold optimists.
On the flip side, acceptance above the aforesaid resistance at $1,831 will challenge the powerful barrier at $1,835. At that level, the SMA5 one-day, Fibonacci 38.2% one-week, one-month and one-day converge.
The Fibonacci 61.8% one-day at $1,838 will test the bearish commitments on the additional upside. A dense cluster of strong resistance levels around $1,843 will be the level to beat for XAU bulls. That level comprises the SMA200 one-day, SMA100 four-hour and the Bollinger Band one-day Middle.
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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.