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Gold price technical analysis and what levels to watch
(Kitco News) - The gold prices instinctively rose after reports of the new omicron COVID-19 variant was found last week. The momentum has somewhat died since then and the gold price has consolidated back around the volume point of control (VPOC) area on the chart. This area is marked by the red horizontal line and it represents where most contracts have been traded at what price.
This zone was extremely sticky in the past and if we are heading to another time like that $1800/oz seems like fair value for now. Away from this, the price is also back in the apex from the trendlines. When the price fell it found support at the upward sloping trendline marked in grey. Looking at levels lower down, the current wave low of $1777/oz could now be in focus and any break below could be seen as bearish. Beyond that, there are two support levels to watch at $1750/oz and $1720/oz respectively.
On the upside, the break of the triangle formations would be welcome for the bulls and the green consolidation high is another area of concern. The main resistance however is the previous wave high at $1879.5/oz. This is the level the price stopped at on the last decent run before central bankers were talking about accelerated tapering. Now the new variant is around maybe there could be a delay to the taper and the level could come back into focus.
