Gold is trying hard to recover ground above the $1800 mark, as the US dollar continues to benefit from broad risk-aversion amid looming coronavirus risks. Let’s see how it is positioned ahead of the critical US CPI release.
The Technical Confluences Indicator shows that the yellow metal is likely to face an uphill task to take on the upside, with the immediate hurdle seen around $1804, where the SMA5 one-day, Fibonacci 61.8% one-day and SMA5 on four-hour converge.
Acceptance above the latter will see a test of minor resistance at $1807, the Fibonacci 23.6% one-week. The bulls will have to clear a bunch of small resistances before it retakes Monday’s high of $1813.54.
On the flip side, $1796 is the level to beat for the bears, the confluence of the previous low on four-hour and pivot point one-day S1.
Should the bears take out that level, the floor will open up towards the downside target of $1788. Strong support emerges there, which is the intersection of the Fibonacci 61.8% one-week, Fibonacci 161.8% one-day and SMA10 one-day.
Here is how it looks on the tool