Gold Price Forecast: XAU/USD reverses from a jungle of resistances below $1,925 – Confluence Detector
- Gold price extends pullback from six-week high as yield curve inversion defends US Dollar bulls.
- XAU/USD clings to $1,900 confluence, failure to cross $1,925 hurdle keep bears hopeful.
- Mixed headlines surrounding SVB, Fed bets challenge Gold traders ahead of second-tier US data.
Gold price (XAU/USD) takes offers to renew intraday low around $1,900, sticking to short-term key support during the mid-week inaction. In doing so, the bright metal takes clues from the recently widening difference between the US 10-year and two-year Treasury bond yields. Also exerting downside pressure on the XAU/USD price could be the global policymakers’ inability to convince the market of the risks emanating from the latest fallouts of the Silicon Valley Bank (SVB) and Signature Bank. Furthermore, the recent run-up in the Fed fund futures favoring a 0.25% rate hike in March also put a floor under the US Dollar, which in turn weighs on the Gold price.
It should be noted that the XAU/USD traders seem to have a limited upside room amid brighter odds favoring the downbeat US data relating to Retail Sales, Industrial Production and Producer Price Index. Above all, risk catalysts and the next week’s Federal Open Market Committee (FOMC) Monetary Policy Meeting is the key catalyst for Gold traders to watch for clear directions.
Also read: Gold Price Forecast: XAU/USD appears ‘buy the dips’ trade amid dovish Fed bets
Gold Price: Key levels to watch
As per the Technical Confluence Detector, the Gold price recently slipped beneath the key $1,901-1900 support-turned-resistance including Fibonacci 161.8% on one-month and 23.6% on one-day.
With this, the XAU/USD appears well-set to drop further towards the convergence of the Pivot Point one-day S1 and the previous daily low surrounding $1,895.
Following that, Pivot Point one-week R1 could act as the last defense of the Gold buyers near $1,890.
Alternatively, a clear upside break of $1,901 isn’t an open invitation to the Gold buyers as Fibonacci 38.2% on one-day and middle band of the Bollinger on Hourly play probes further upside near $1,905.
Even if the XAU/USD crosses the $1,905 hurdle, Pivot Point one-week R2 and Pivot Point one-day R1 can challenge the metal’s further upside near $1,910 and $1,914 levels respectively.
Above all, the Gold price remains bearish unless it stays beyond the $1,924 hurdle comprising Pivot Point one-month R1 and one-day R2.
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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.