Gold Price Analysis: XAU/USD challenges critical $1907 barrier, levels to watch – Confluence Detector

Gold (XAU/USD) is struggling to extend gains above $1900, as the US dollar regains footing on Monday after the Chinese Q3 GDP disappointed and tempered the risk-on market mood. The yellow metal remains in familiar trading ranges around the $1900 mark, underpinned by the hopes of a new US fiscal stimulus and vaccine optimism

Gold settled last week in the red, holding onto $1900, keeping the buyers hopeful. Let’s see how gold is positioned on the charts.  

Gold: Key resistances and supports

The Technical Confluences Indicator shows that the yellow metal remains capped below a major upside barrier at $1904, which is the convergence of the previous high four-hour, Fibonacci 38.2% one-month and SMA200 one-hour.

The XAU bulls need to recapture the next critical level at $1907 (SMA5 one-day) to unleash the further upside, beyond which the $1910 (Bollinger Band one-hour Upper) level will get tested.  

The next target for the buyers is aligned at $1915, the intersection of the Fibonacci 61.8% one-week and SMA200 four-hour.

Alternatively, sellers aim for $1897, where the previous day low coincides with the SMA100 on four-hour.

The next significant cushioned is placed at $1894, the confluence of the Fibonacci 23.6% one-week and pivot point one-day S1.

A sharp sell-off could be triggered below the latter, opening floors for a test of $1883, powerful support comprising of the previous week low and Fibonacci 23.6% one-month.

Here is how it looks on the tool

About 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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