Gold Price Forecast: XAU/USD volatile within $1800-$1770 range ahead of Fed – Confluence Detector

• Gold price falls further amid pre-Fed anxiety, DXY, yields hold firmer.
• The Fed is likely to announce tapering by $15 billion per month.
• Fed November Preview: Gold needs a dovish surprise to overcome key hurdle.

It’s the all-important Fed Day this Wednesday, with the US dollar and Treasury yields firming up, as a rollback of asset purchases by $15 billion per month is already discounted by the market. Gold traders will look for hints on the Fed’s timing of the interest rates hike and the inflation outlook to steer the fresh direction in the bright metal. Ahead of the Fed event, the US ADP jobs and ISM Services PMI data will offer some trading incentives.

Read: Fed Interest Rate Decision Preview: Inflation, employment and interest rates

Gold Price: Key levels to watch

The Technical Confluences Detector shows that gold is on its way to test the Bollinger Band four-hour Lower support at $1777, as the downward spiral extends.

The next stop for gold bears is envisioned at $1775, the pivot point one-day S3.

The intersection of the previous week’s low and Fibonacci 61.8% one-month around $1772 will be a tough nut to crack for gold sellers.

The SMA200 four-hour at $1770 will be the line in the sand for the optimists.

On the upside, immediate resistance around $1782 will challenge the bulls. That level is the confluence of the Fibonacci 23.6% one-week, SMA50 one-day and pivot point one-day S2.

Gold buyers will then seek fresh entries above the SMA100 four-hour at $1785.

Further up, a dense cluster of healthy resistance levels between $1788-$1790 will test the bearish commitments on the road to recovery.

That zone is the convergence of the Fibonacci 23.6% one-day, Fibonacci 38.2% one-month and SMA100 one-day.

The SMA200 one-day at $1793 will offer additional resistance, above which the Fibonacci 23.6% one-month at $1799 will be eyed.  

Here is how it looks on the tool

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.