Gold Price Forecast: XAU/USD’s downside appears capped near $1,845 ahead of Fed minutes – Confluence Detector

• Gold price remains at the mercy of the geopolitical woes, Fed’s sentiment.
• The January FOMC minutes could playdown the hawkish prospects.
• US January Retail Sales Preview: Geopolitics, FOMC Minutes to impact dollar’s valuation.

The week so far has been quite overwhelming for gold price, with more action foreseen on the critical event risks from the US. The Fed minutes and the US Retail Sales will grab the market’s attention away from the ongoing theme around the Russia-Ukraine geopolitical tensions. Although, the risks around the Ukrainian border persist and will continue to lead the sentiment alongside the Fed’s hawkish outlook in the upcoming sessions.

Read: FOMC Minutes Preview: Dollar selling opportunity? Doves set for a comeback after hawkish meeting

Gold Price: Key levels to watch

As well predicted, gold price did test the $1,878 resistance zone before plummeting on a sudden turnaround in the market sentiment.

Looking ahead, the Technical Confluences Detector shows that the downside in the gold price has been capped around the $1,852-$1,850 region so far, which is the convergence of the previous month’s high, Fibonacci 23.6% one-day and one-week.

A firm break below the latter will fuel a fresh decline towards the previous day’s low of $1,845.

Further south, the intersection of the pivot point one-month R1 and Fibonacci 38.2% one-week at $1,843 will come to the rescue of gold bulls.

The pivot point one-day S1 at $1,838 will emerge as the last line of defense should the corrective downside extend.

On the flip side, gold price needs to find acceptance above $1,859, where the Fibonacci 38.2% one-day coincides with the Bollinger Band one-hour Upper.

The next bullish target is seen at the SMA10 four-hour of $1,862, above which powerful resistance at $1,866 will get retested.

At the point, the Fibonacci 61.8% one-day and the previous week’s high connect.

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.