Gold Price Forecast: XAU/USD eyes $1,850 and $1,855 as next upside targets – Confluence Detector

• Gold price looks to recapture $1,850 as the US Dollar eases with Treasury yields.
• Market mood remains upbeat despite the Wall Street disappointment.
• Focus shifts back to the fundamentals, with eyes on US data and Fed Minutes.

Gold price is seeing fresh demand, aiming to recapture the key $1,850 level amid a positive shift in the market’s perception of risk. Investors look past Wall Street’s negative performance, as they await the US ISM Manufacturing PMI and US Federal Reserve (Fed) December meeting Minutes for fresh trading incentives. The latest leg up in the Gold price could be attributed to the retreat in the US Dollar across the board, dragged down by the weakness in the US Treasury bond yields. Concerns over a potential global economic recession this year continue to underpin the ongoing uptrend in the bright metal. Looking ahead, the fundamental factors, including the economic data, are likely to trigger a significant market reaction, impacting the Gold trades alongside risk sentiment.

Also read: Happy new year 2023: Is this a Gold or USDX rally?

Gold Price: Key levels to watch

The Technical Confluence Detector shows that the gold price is eyeing a sustained break above the previous day’s high at $1,850 on its renewed upside.

The next relevant stop for Gold bulls is seen at the pivot point one-week R2 at $1,855, above which a fresh rally toward the pivot point one-day R2 at $1,863 cannot be ruled out.

Alternatively, the Fibonacci 23.6% at $1,843 is lending immediate support to Gold buyers. Failure to defend the latter will expose the next downside cap at around $1,849, where the Fibonacci 38.2% one-day meets with the pivot point one-week R1 the previous high four-hour.

Powerful support aligns at around $1,834, which is the intersection of the previous week’s high and the previous month’s high of $1,833. That level also coincides with the Fibonacci 61.8% one-day, making it a tough nut to crack for Gold bears.

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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.