Gold (XAU/USD) is consolidating within Thursday’s trading range above $1850, as investors await President Joe Biden’s speech for the next direction. Markets are weighing in the prospects of the US fiscal spending and its impact on the economic recovery.
Further, concerns over a quick passage of Biden’s $1.9 trillion stimulus proposal by the US Congress weigh on the metal. Profit-taking heading into the weekend also seems to keep the gold bulls unnerved.
Meanwhile, the US dollar wallows near weekly lows, which could offer some support to gold prices. Let’s look at the technical graphs for better understanding. How is gold positioned on the charts?
Gold Price Chart: Key resistances and supports
The Technical Confluences Indicator shows that gold is testing major support at $1863, which is the confluence of the SMA5 one-hour and the previous week high.
Powerful support at $1860 will guard the downside. That level is the intersection of the SMA50 one-day, pivot point one-day S1 and the previous low four-hour.
A failure to resist above the latter would open floors towards $1857, the Fibonacci 38.2% one-month.
Further south, the confluence of the SMA50 four-hour and SMA10 one-day at $1848 could challenge the bears’ commitment.
To the upside, strong resistance around $1870 could be tested. The Fibonacci 61.8% one-day and SMA10 four-hour meet at that point.
The XAU bulls need to crack critical barrier at $1877 (SMA100 four-hour, pivot point one-day R1) to unleash further upside.
The SMA100 one-day at $1883 would be next on the buyers’ radars.
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.
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 climbs to 10-day highs above 1.0700
EUR/USD gained traction and rose to its highest level in over a week above 1.0700 in the American session on Tuesday. The renewed US Dollar weakness following the disappointing PMI data helps the pair stretch higher.
GBP/USD extends recovery beyond 1.2400 on broad USD weakness
GBP/USD gathered bullish momentum and extended its daily rebound toward 1.2450 in the second half of the day. The US Dollar came under heavy selling pressure after weaker-than-forecast PMI data and fueled the pair's rally.
Gold rebounds to $2,320 as US yields turn south
Gold reversed its direction and rose to the $2,320 area, erasing a large portion of its daily losses in the process. The benchmark 10-year US Treasury bond yield stays in the red below 4.6% following the weak US PMI data and supports XAU/USD.
Here’s why Ondo price hit new ATH amid bearish market outlook Premium
Ondo price shows no signs of slowing down after setting up an all-time high (ATH) at $1.05 on March 31. This development is likely to be followed by a correction and ATH but not necessarily in that order.
Germany’s economic come back
Germany is the sick man of Europe no more. Thanks to its service sector, it now appears that it will exit recession, and the economic future could be bright. The PMI data for April surprised on the upside for Germany, led by the service sector.