Gold Price Analysis: Bulls target $1,663 after the Fed's coronavirus cut – Confluence Detector

Gold prices have surged after the Federal Reserve announced an emergency rate cut of 50 basis points in response to the coronavirus crisis. Lower yields make the precious metal more attractive. 

The Technical Confluences Indicator is showing that XAU/USD faces resistance at $1,658, which is where the Pivot Point one-week Resistance 1 hits the price.

Further up, $1,663 is a cluster including the Bollinger Band one-day Upper, the PP one-day R1, and the PP one-month R1.

Support awaits gold at $1,641, which is the convergence of the BB 15min-Lower and the Fibonacci 61.8% one-week.

Further down, the yellow metal has support at $1,636, which is the meeting point of the Fibonacci 61.8% one-month, the Simple Moving Average 200-1h, and the Fibonacci 23.6% one-day.

Here is how it looks on the tool:

Confluence Detector

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.

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