- Gold price pulls back from multi-week highs amid Fed rate hikes speculation.
- Risk-on sentiment at the start of 2022 also bodes ill for the bright metal.
- Gold 2022 Outlook: Correlation with US T-bond yields to drive yellow metal.
Gold is feeling the pull of gravity on the first trading day of 2022, in what seems to be a correction from six-week highs of $1,832. Expectations that the upcoming US first-tier economic events, including the ISM PMIs and Nonfarm payrolls, will confirm a March Fed rate hike are keeping the bulls on the back foot. Additionally, the upbeat market mood is collaborating with the pullback in gold price.
Read: Gold Price Forecast: XAU/USD is down starting out 2022 but not out
Gold Price: Key levels to watch
The Technical Confluences Detector shows that the gold price is trading below strong resistance of $1,827, where the Fibonacci 23.6% one-day coincides with the previous high four-hour and SMA10 one-hour.
The next topside hurdle is seen at the previous day’s high of $1,830, above which the multi-week top of $1,832 will be challenged once again.
The pivot point one-day R1 at $1,835 will be a tough nut to crack for gold bulls.
On the flip side, strong support is pegged at $1,821, the intersection of the Fibonacci 61.8% one-day, Fibonacci 23.6% one-week and previous low four-hour.
The next relevant cap is seen at 1,818, which is the pivot point one-day S1. Friday’s low of $1,815 will be next on sellers’ radars.
The convergence of the SMA100 one-hour and Fibonacci 23.6% one-month at $1,812 will be the line in the sand for gold buyers.
Here is how it looks on the tool
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.
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
AUD/USD languishes near multi-year lows below 0.6250 after dovish RBA Minutes
AUD/USD remains depressed below 0.6250 early Tuesday after the December RBA Minutes reiterated that upside inflation risks had diminished, which reaffirms bets for a rate cut in early 2025. This, along with concerns about China's fragile economic recovery and US-China trade war, undermines the Aussie and weighs on the pair.
USD/JPY eases toward 157.00 after Japanese verbal intervention
USD/JPY has come under renewed selling pressure, easing toward 157.00 after Japanese Finance Minister Kato's verbal intervention. The pair erased early gains, induced by the October BoJ meeting Minutes. However, the downside could be limited as the US Dollar hold the previous rebound.
Gold remains stuck between two key barriers amid thin trading
Gold price is attempting another run higher while defending the $2,600 threshold early Tuesday. In doing so, Gold price replicates the recovery moves seen in Monday’s trading, which eventually fizzled out on a broad US Dollar comeback in tandem with US Treasury bond yields.
Solana dominates Bitcoin, Ethereum in price performance and trading volume: Glassnode
Solana is up 6% on Monday following a Glassnode report indicating that SOL has seen more capital increase than Bitcoin and Ethereum. Despite the large gains suggesting a relatively heated market, SOL could still stretch its growth before establishing a top for the cycle.
Bank of England stays on hold, but a dovish front is building
Bank of England rates were maintained at 4.75% today, in line with expectations. However, the 6-3 vote split sent a moderately dovish signal to markets, prompting some dovish repricing and a weaker pound. We remain more dovish than market pricing for 2025.
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.