Bull Wedge Target Complete
Today’s advance reached the target from the bullish wedge breakout at 2,320. At that point gold entered a resistance zone that also includes two trendlines, each is a top channel line of a different rising parallel trend channel. So, there are two trendlines and the target from the wedge pattern culminating in the 2,320 to the 2,330-price zone, approximately.
Maybe gold busts right through the zone and keeps rising. However, it also increases the chance that gold is close to at least a temporary high. If weakness follows today’s high, then there is a chance that this resistance zone is stopping the ascent for now.
New Highs Next Week Could See Gold at 2,348
Also, a decisive breakout above today’s high and a continuation higher has gold possibly rising to the next higher target zone. That is at the confluence of several Fibonacci extension levels that identify a price range from 2,348 to 2,355. The range includes the 161.8% Fibonacci extension of the retracement from the full downswing that occurred from the March 2022 swing high, at 2,352.
This potential for new highs next week indicates a strong bullish momentum in the gold market, with the Fibonacci extension levels providing key price targets for traders to watch out for in the coming days.
Overdue for a Retracement, Yet Remains Strong
There is a solid argument that gold is extended and overdue for a retracement, yet it keeps on climbing. It is set to close strong for the week, near the highs, further confirming the strength of a long-term base breakout that triggered last month. It was a three-and-a-half-year base where gold traded within a large relatively sideways price range.
The close for the month was the highest monthly closing price ever. Several earlier attempts had failed to follow through. Certainly, the current breakout is showing no signs of failure so far. However, as noted above, it is in a decision zone that could lead to a pullback. It could get tricky though as a drop below today’s low of 2,268 would be needed for a weakening signal on the daily time frame.
Despite the potential for a retracement, the overall bullish trend in gold remains intact, with the market displaying resilience and strength even in the face of possible pullbacks. This demonstrates the underlying strong sentiment among traders towards gold.
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