Gold price has kicked off the NFP week on the wrong footing, challenging the $1750 psychological barrier amid a rebound in the US Treasury yields across the curve. Rising inflation expectations calls for a sooner than expected monetary policy tightening by the Fed, lifting the rates on the markets. Meanwhile, the broader market sentiment remains tepid amid China Evergrande uncertainty and fresh US-Sino trade jitters limiting the downside in gold price. The US dollar retreat also helps gold price, although light trading could exaggerate moves in the bright metal.
Gold Price: Key levels to watch
According to the Technical Confluences Detector, gold is testing bids at critical support at $1749, which is the convergence of the previous low one-hour, Fibonacci 23.6% one-month and Fibonacci 38.2% one-week.
On a sustained move below the latter, the intersection of the SMA100 one-hour and pivot point one-day S2 and SMA5 one-day at $1744 could be tested.
$1739 will be the level to beat for gold bears, which is the confluence of the pivot point one-day S3 and Fibonacci 61.8% one-week.
On the flip side, strong resistance appears around $1754, where the Fibonacci 23.6% one-week coincides with the SMA50 one-hour and SMA10 one-day.
The next upside target is seen at $1759, the Fibonacci 38.2% one-day. The previous day’s highs at $1764 could then challenge the recovery momentum.
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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.