Gold Price Forecast: 23% Fibo support fails, whats next?

28 Mar 2023

• Gold price is attempting a comeback after two straight days of losses.
  Gold price finds support from a retreat in the US Treasury bond yields, as baking jitters ease.
  Bears breach 23.6% Fibo level. Will XAU/USD recover ground above it?
  

Gold price is making a minor comeback after two back-to-back days of heavy declines. Gold price is finding support from a broad-based United States Dollar (USD) decline and a retreat in the US Treasury bond yields early Tuesday.


Gold price tracks US Treasury bond yields action
Gold price kicked off the week on the wrong footing, as the US Treasury bond yields staged a staggering recovery across the curve amid ebbing fears over the global banking crisis. Risk flows dominated after global policymakers came out to soothe the market concerns over a potential banking sector contagion, weighing on the demand for the safe haven US Dollar and the US government bonds.


United States and Federal Reserve speeches on tap
Following a data-quiet Monday, Gold traders gear up for a slew of fresh mid-tier economic releases from the United States. Of note will be the US Conference Board Consumer Confidence data and the Federal Reserve policymakers’ speeches, which will help re-evaluate the Fed rate hike expectations. Federal Reserve Vice Chair for Supervision, Michael Barr, is scheduled to speak again on Tuesday.


Gold price breached the strong support of the 23.6% Fibonacci Retracement (Fibo) level of the March advance, pegged at $1,963, triggering a fresh sell-off to a three-day low of $1,944 on Monday.

However, Gold price saw a late rebound and managed to recapture the $1,950 psychological level on a daily closing basis, keeping bulls hopeful.

Therefore, Gold bulls are trying their luck early Tuesday, looking to clear the key support-turned-resistance at $1,963.

Acceptance above the latter will initiate a fresh upswing toward the previous day’s high of $1,981, above which the $2,000 level will be eyed.

The 14-day Relative Strength Index (RSI) holds bullish amid a 21-Daily Moving Average (DMA) and 50 DMA Bull Cross in play. Any pullbacks in Gold price could be seen as a good buying opportunity.

To the downside, immediate support awaits at the $1,950 barrier and the previous day’s low of $1,944. The next cushion is seen at $1,934, which is the 38.2% Fibo level of the same ascent.