Gold Price Analysis: XAU/USD bulls eye $1,818

XAU/USD : Daily chart

This is what it sounds like when doves do not cry – Paraharasing Prince’s 1984 hit, Federal Reserve Chair Jerome Powell has shown his dovish feathers, sending gold above $1,800. Contrary to a long list of his hawkish colleagues, Powell, the man at the top, refrained from committing to tapering the bank’s $120 billion/month bond-buying scheme soon. While he acknowledged improvement in the labor market, his stance on inflation was mixed and he expressed worries about covid.

If the Fed continues printing dollars at a rapid clip, stock markets and the precious metal have reasons to be cheerful. After the initial gold rush, how is XAU/USD positioned on the charts? 

The Technical Confluences Detector is showing that gold is battling near-term resistance at around $1,800, which is a cluster including the Fibonacci 38.2% one-month, the Bollinger Band 4h-Upper, the Pivot Point one-week Resistance 2, and more.

Bulls are eyeing higher levels, and $1,818 stands out. That is the convergence of the Fibonacci 23.6% one-month, the PP one-day R3 and the PP one-week R3.

Immediate support awaits at $1,805, which is where the BB 1h-Upper and BB 15min-Upper hit the price. 

The next significant cushion is at $1,796, which is the confluence of the previous weekly high, the BB 4h-Middle and the Simple Moving Average 5-1h. 

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