Gold Price Analysis: XAU/USD has a clear floor for the current retreat – Confluence Detector
|Gold prices have fallen off their highs, cooling down as fiscal stimulus talks have yet to reach the final line. While both Republicans and Democrats are reporting progress, time is running out toward the elections and it is unclear if lawmakers would opt to pass legislation during the "lame duck" period.
The precious metal was rising on hopes for a multi-trillion dollar injection of funds from the federal government. Moreover, the market mood dampened after US security authorities said that Iran and Russia obtained voter registration files and are threatening people ahead of Election Day. Concerns about foreign interference may contribute to a contested election and no new stimulus.
How is XAU/USD positioned after these developments?
The Technical Confluences Indicator is showing that gold has robust support at $1,909, which is the convergence of the Simple Moving Average 200-1h and the SAM 5-one-day.
Below this critical line, an additional cushion awaits at $1,903, which is where the Fibonacci 38.2% one-month and the Fibonacci 38.2% one-week meet up.
Looking up, resistance is at $1,925, the confluence of the 50-day SMA, and the Fibonacci 23.6% one-day.
Further above, $1,923 serves as an upside target. It is where the Bollinger Band one-day Upper and the previous week's high converge.
Key XAU/USD resistances and supports
Confluence Detector
The Confluence Detector finds exciting opportunities using Technical Confluences. The TC 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. Knowing where these congestion points are located is very useful for the trader, and can be used as a basis for different strategies.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.