Gold is attempting to make a comeback, emerging above $1,700 as the market mood worsens and as the S&P 500 corrects lower after previously erasing its gains for 2020. Will the precious metal continue attracting buyers? How is it positioned on the charts?
The Technical Confluences Indicator is showing that XAU/USD faces initial resistance at $1,716, which is the convergence of the Pivot Point one-day Resistance 2, the Simple Moving Average 200-4h, the Fibonacci 61.8% weekly, and more.
The upside target is $1,722, which is the meeting point of the SMA 200-4h, the BB 4h-Upper, and the BB one-day Middle.
Support awaits at $1,706, which is the confluence of the Fibonacci 61.8% monthly and the PP R1-daily.
Further down, $1,701 is another cushion, where we find the SMA 5-4h, the SMA 100-1h, and the previous daily high converge.
All in all, the path of least resistance is down
Here is how it looks on the tool:
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.
This tool assigns a certain amount of “weight” to each indicator, and this “weight” can influence adjacents price levels. These weightings mean that one price level without any indicator or moving average but under the influence of two “strongly weighted” levels accumulate more resistance than their neighbors. In these cases, the tool signals resistance in apparently empty areas.
Learn more about Technical Confluence
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