Gold has been on a corrective path, recapturing the $1,900. Earlier, it dropped as the US Senate adjourned without approving a stimulus bill. Talks between Republicans and Democrats have been going on for months and hopes were high at some points.
The prospects of a multi-trillion package boosted the precious metal, and the realization that it would have to come after the elections later weighed on it. XAU/USD now seems to hinge on the prospects for a “blue wave” that would unleash generous funding from the government and create a “golden age” for gold.
In the meantime, how are technicals looking?
The Technical Confluences Indicator is showing that fierce resistance awaits at $1,910, which is the convergence of the Fibonacci 61.8% one-week and the previous daily high.
Above that critical level, the upside target is $1,923, which is a juncture of lines including the Fibonacci 23.6% one-week and the Pivot Point one-week Resistance 1.
Support awaits at $1,904, which is the confluence of the Fibonacci 38.2% one-month, the Bollinger Band 4h-Middle, the Simple Moving Average 10-one-day, the Fibonacci 23.6% one-day, and the SMA 101h.
Further down, XAU/USD could deteriorate all the way to $1,887, which is where the Pivot Point one-week Support 1 hits the price.
Key XAU/USD resistances and supports
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.
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