Gold Price Forecast: XAU/USD retreat needs acceptance from $1,998 and Fed – Confluence Detector

• Gold Price pares the biggest daily gain in a month amid pre-Fed anxiety.
• Mixed catalysts surrounding bank turmoil, US data and debt ceiling extension prod XAU/USD traders.
• Fed needs to defend hawkish bias and push back policy pivot talks to lure Gold bears.

Gold price (XAU/USD) grind higher after defying the fortnight-old trading range as market players brace for the all-important Federal Reserve (Fed) decision.

It’s worth noting that the precious metal rose the most in one month the previous day as mixed US data raised doubts over the Fed’s future rate hikes, especially when the White House blames higher rates for banking turmoil. Also keeping the floor under the XAU/USD price are hopes of strong growth in China and India, one of the biggest Gold consumers.

However, fears of more banking fallouts, overall strong inflation and early signals from the Fed officials suggest the US Dollar’s likely rebound, which in turn prod the XAU/USD buyers.

Hence, the Gold price portrays typical pre-Fed anxiety amid mixed catalysts, as well as due to holidays in China and Japan.

Also read: Gold Price Forecast: XAU/USD confirms a trading range breakout ahead of FOMC decision

Gold Price: Key levels to watch

Our Technical Confluence indicator suggests that the Gold price fades the previous day’s upside break of the key resistances, now immediate support as traders await the Federal Open Market Committee (FOMC) monetary policy meeting announcements.

Among them, the $2,010 level comprising the previous weekly high and Fibonacci 23.6% on one-day gains immediate attention of the intraday sellers of the Gold price. Following that, the $2,000 round figure could challenge XAU/USD fall.

That said, the $1,998 level appears a tough nut to crack for the Gold bears past $2,000 as it includes the SMA10 on 4H and Fibonacci 38.2% on one-week.

It’s worth noting that multiple levels marked during late April around $1,990 and $1,970 could challenge the XAU/USD downside past $2,000.

Meanwhile, Gold price recovery needs validation from $2,025 level encompassing Fibonacci 23.6% on one-month and Pivot Point one week R2.

In a case where the Gold price remains firmer past $2,025, the upper band of Bollinger on one-day and Pivot Point one-day R1 may act as an extra upside filter.

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.