The flight to safety theme, in the face of rising coronavirus cases and regional lockdowns globally, drove Gold drove to its highest level since November 2011. The price, however, fell an arm’s distance short of the $1800 mark. Let’s see how it is positioned for the day ahead.
The Technical Confluences Indicator shows that the yellow metal is likely to face a small hurdle near $1798 (eight-year high) before the bulls resume its quest for the 1800 handle.
On a break above the latter, the next resistance is seen at $1806, the pivot point one-week R2.
Alternatively, the immediate downside could be cushioned at the pivot point one-week R2 near $1791.50.
The buyers will likely remain hopeful as long as the bright metal holds above the critical $1789 support, where the Bollinger Band one-hour Middle, SMA5 4H and previous week high.
Further south, the previous month high at $1785.91 will be put to test.
Here is how it looks on the tool
The Confluence Detector finds exciting opportunities using Technical Confluences. The TC 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. Knowing where these congestion points are located is very useful for the trader, and can be used as a basis for different strategies.
This tool assigns a certain amount of “weight” to each indicator, and this “weight” can influence adjacents price levels. These weightings mean that one price level without any indicator or moving average but under the influence of two “strongly weighted” levels accumulate more resistance than their neighbors. In these cases, the tool signals resistance in apparently empty areas.