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  • The price of gold rebounded from a weekly low, snapping a four-day losing streak amid risk-on sentiment.
  • Headlines from China, concerns about policy pivoting by major central banks support sentiment and drive the price of XAU/USD.
  • Anxiety ahead of key central bank events, confluence of resistance at $1,975 spurred gold buyers.
  • Data on the US mid levels may entertain XAU/USD traders, but the Fed and ECB plays are crucial for tracking clear directions.

The price of gold (XAU/USD) is reversing from a two-week low, snapping a four-day downtrend, as headlines about stimulus from China and central banks boosted sentiment and the price of XAU/USD. In doing so, XAU/USD traders are displaying cautious market optimism ahead of this week’s top dates/events.

Headlines fueling hopes for Chinese stimulus and banking intervention from Beijing appear to be boosting optimism in the Asia-Pacific zone. However, mixed concerns over previously released PMIs and central bank measures appear to be driving XAU/USD bulls.

Among those plays, S&P500 futures remain on the sidelines near 4,580, looking to extend the previous day’s rally, while yields on 10-year and 2-year US Treasuries retreated from two-week highs to 3.86% and 4.84%, respectively. It should be noted that the retreat of the US dollar from the 14-day high is also portraying market optimism and driving the price of gold.

Looking ahead, US CB consumer confidence for July, expected at 112.10 vs. 109.70 earlier, will drive intraday gold price movements. However, much attention will be paid to the monetary policy meeting of the Fed and the FED ECBas well as indications for the same.

Also read: Gold Price Forecast: Will XAU/USD Bounce Seek Acceptance Above 100 DMA?

Gold Price: Key Levels to Watch

Our technical confluence indicator suggests gold price inactivity around the $1,964 support, which has turned into resistance involving the 100-DMA and the 61.8% one-day-one-week Fibonacci convergence.

XAU/USD’s ability to break above $1,964 joins bullish sentiment and a pullback in the US dollar to keep buyers hoping for a break above the $1,975 resistance confluence including Fibonacci 78.6% at weekly and Pivot Point one-month R1.

After that, the previous monthly high and the weekly R1 Pivot Point will act as the last defense of the XAU/USD bears near $1,985.

Meanwhile, a break of the $1,964 resistance, reversed to support (shown above), can quickly pull the gold price to $1,960, including Fibonacci 38.2% on the one-day and 10-DMA.

However, weakness in XAU/USD around $1,960 could convince the bears to attack the $1,950 support comprising the lower Bollinger band on the four-hour, Fibonacci 61.8% on the one-month and the Pivot Point on the one-day S1.

Overall, the gold price is regaining upward momentum, but bulls need validation from $1,975.

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About the technical coincidence detector

TCD (Technical Confluences Detector) is a tool to find and show price levels where congestion occurs indicatorsmoving averages, Fibonacci levels, Pivot Points, etc. If you are a short-term trader, you find entry points for countertrend strategies and hunt for a few points at a time. If you are a medium to long term trader, this tool allows you to know in advance the price levels where the medium to long term trend can stop and rest, where to unwind positions or where to increase position size.

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