Gold Price Forecast: XAU/USD eyes $1,800 and $1,806 on road to recovery – Confluence Detector
- Gold price keeps the corrective upside intact towards $1,800.
- Omicron covid fears smash the US dollar alongside the Treasury yields.
- Gold looks to extend rebound amid renewed coronavirus fears.
Gold has staged a decent comeback, as bulls look to recapture the $1,800 mark amid a revival of the Omicron covid variant fears. A flight to safety theme remains in vogue, as investors scurry to the US Treasuries, killing the demand for the yields. The sell-off in the US rates have heavily weighed on the dollar, boosting gold’s appeal. However, should risk-aversion intensify the greenback could regain its safe-haven status, capping the gold price recovery.
Read: Gold Price Forecast: Risks remain skewed to the downside for XAU/USD as key support caves in
Gold Price: Key levels to watch
The Technical Confluences Detector shows that the gold price is extending its recovery towards $1,799-$1,800, which is the convergence of the previous day’s high and Fibonacci 23.6% one-month.
The next relevant upside barrier for gold bulls is pegged at 1,806, where the Fibonacci 38.2% one-week lies.
Further up, the pivot point one-day R2 at $1,808 will test the bearish commitment on the road to recovery.
The previous month’s high at $1,814 continues to remain on the buyers’ radars.
On the flip side, the immediate downside seems guarded by a dense cluster of healthy support levels around $1,793.
At that point, the Fibonacci 61.8% one-day coincides with the SMA50 one-day and SMA200 one-day.
The next critical cushion is seen at $1,789, which is a confluence of the Fibonacci 38.2% one-day and SMA5 one-day. Floors will then open up towards Friday’s low of $1,780.55.
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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.
Author
Dhwani Mehta
FXStreet
Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.
