Gold reports three- day downtrend in between US stimulus concern

Foto

Gold (XAU/USD) is nursing losses after three consecutive days of declines, although remains in a familiar range above $1850. The renewed concerns about a $900 billion COVID-19 relief package could likely keep gold on the back foot. US President Donald Trump asked for an amendment to the pandemic relief package.

 

However, broad-based US dollar retreat cushions the downside in gold. Brexit deal optimism and disappointing US Consumer Confidence data weigh negatively on the greenback. Pre-Christmas thin trading conditions will continue to play out ahead of the US economic releases.

The XAU/USD pair is struggling to overcome a dense cluster of resistance levels stacked up around the $1867-69 region.

A firm break above the latter could expose a minor cap at $1874, which is the convergence of the SMA5 one-day and Fibonacci 61.8% one-day.

 

Up next, the bulls are likely to challenge the critical barrier at $1880, the intersection of the Pivot Point one-day R1, Fibonacci 23.6% one-week and Bollinger Band four-hour Middle.

 

To the downside, minor support awaits at $1861, where the SMA200 one-hour coincides with SMA50 four-hour and the previous low four-hour.

 

The SMA10 one-day at $1856 is the next relevant downside target, below which the Pivot Point one-day S1 of $1852 could be probed.

 

The bears need a break below the $1850 barrier to reviving the bearish bias. The Fibonacci 61.8% one-week is aligned at that level.