Gold (XAU/USD) started out the US Non-Farm Payrolls (NFP) week on a solid footing, rallying nearly $20 on Monday. The metal bounced-off the SMA100 one-day support for the third straight day, courtesy of the broad retreat in the US dollar from two-month peaks.
The risk-on mood returned amid upbeat Chinese Industrial Profits data, lifting the sentiment on the global markets at the expense of the safe-haven greenback. Further, hopes of the US Congress reaching a fiscal stimulus deal also added to the broader market optimism.
Attention now turns towards a slew of speeches by the Fed policymakers, US Consumer Confidence data and the first US Presidential election debate for fresh cues on the prices. Meanwhile, let’s see how gold is positioned technically.
Gold: Key resistances and supports
Following the corrective move higher, the Technical Confluences Indicator suggests that Gold faces immediate fierce resistance at $1889, which is the convergence of the Fibonacci 38.2% one-week and Bollinger Band 15-minutes Upper.
Buyers will then look to takeout the next hurdle at $1894, the intersection of the pivot point one-day R1 and Bollinger Band one-hour Upper.
A sharp rally towards the $1905 barrier will get fuelled, which is the pivot point one-day R2.
To the downside, significant support at $1875 could likely limit the pullbacks. At that level, the SMA5 one-day coincides with the Fibonacci 23.6% one-day.
Further down, a bunch of minor support levels will slow the declines before the bullion reaches the critical cushion at $1863, which is the convergence of the previous month low, Fibonacci 61.8% one-day and pivot point one-month S1.
Here is how it looks on the tool
About Confluence Detector
The TCI (Technical Confluences Indicator) 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.
Learn more about Technical Confluence
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD treads water just above 1.0400 post-US data
Another sign of the good health of the US economy came in response to firm flash US Manufacturing and Services PMIs, which in turn reinforced further the already strong performance of the US Dollar, relegating EUR/USD to the 1.0400 neighbourhood on Friday.
GBP/USD remains depressed near 1.2520 on stronger Dollar
Poor results from the UK docket kept the British pound on the back foot on Thursday, hovering around the low-1.2500s in a context of generalized weakness in the risk-linked galaxy vs. another outstanding day in the Greenback.
Gold keeps the bid bias unchanged near $2,700
Persistent safe haven demand continues to prop up the march north in Gold prices so far on Friday, hitting new two-week tops past the key $2,700 mark per troy ounce despite extra strength in the Greenback and mixed US yields.
Geopolitics back on the radar
Rising tensions between Russia and Ukraine caused renewed unease in the markets this week. Putin signed an amendment to Russian nuclear doctrine, which allows Russia to use nuclear weapons for retaliating against strikes carried out with conventional weapons.
Eurozone PMI sounds the alarm about growth once more
The composite PMI dropped from 50 to 48.1, once more stressing growth concerns for the eurozone. Hard data has actually come in better than expected recently – so ahead of the December meeting, the ECB has to figure out whether this is the PMI crying wolf or whether it should take this signal seriously. We think it’s the latter.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.