Gold Price Forecast: XAUUSD sticks to range play near $1,850 ahead of Powell – Confluence Detector

• Gold Price keeps moving back and forth in a familiar range near $1,850.
• Risk tone remains in a better spot as investors take a pause after the sell-off.
• Powell’s testimony holds the key for the next directional move in XAUUSD.

Risk flows and the US dollar weakness remain in play so far this week, as investors assess the recent steep sell-off in global stocks. Additionally, they reposition their bets on the dollar ahead of the critical testimony from Fed Chair Jerome Powell scheduled this week. Gold Price is capitalizing on the reduced haven demand for the greenback, although the renewed uptick in the US Treasury yields is likely to keep any potential rebound restricted. Bulls will also remain cautious ahead of Powell’s testimony before US Congress on the semi-annual Monetary Policy Report. The Fed’s tightening expectations and fears over a looming recession could also significantly impact XAU/USD.

Also read: Is the US on the brink of a recession?

Gold Price: Key levels to watch

The Technical Confluence Detector shows that Gold Price is challenging the $1,840 level on its road to recovery. That level is the convergence of the Fibonacci 38.2% one-day, SMA50 four-hour and the previous high four-hour.

The next upside target is seen at the confluence of the Fibonacci 61.8% one-day and SMA10 one-day at $1,843.

Further up, strong resistance aligns at $1,845, where the SMA200 one-day coincide with the SMA100 four-hour.

Alternatively, the previous day’s low of $1,835 will be the immediate downside target, below which the pivot point one-day S2 at $1,828 will come into play.

The Fibonacci 23.6% one-week at $1,823 will be the level to beat for XAU sellers.

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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.