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Short-term Weakness Below $3,194
Nonetheless, a drop below today’s low will show short-term weakness and further still on a decline below Monday’s low of $3,194. However, Fridays low of $3,173 is a better judge of support for the three-day price range. And it can be considered along with the April 3 high of $3,168. That was the most recent trend bull breakout level. Both the top purple channel line and the 20-Day MA, now at $3,086, are key potential support areas to watch.
Higher Targets Start at $3,298
On the upside, a decisive breakout above $3,246 has gold heading towards higher potential targets. First, there is a price zone from $3,298 to $3,306, identified from relatively short-term Fibonacci measurements. Subsequently, there are two higher targets at $3,335 and $3,355. The first higher target is a 261.8% extension of the decline from the 2011 peak. Given its very long-term nature, that price level may have greater significance. The next price level is a 200% extended target from a rising ABCD pattern that begins from the August 2018 low.
Bullish Engulfing Pattern on Weekly Chart
There is also a bullish pattern on the weekly chart (not shown) as last week completed a bullish engulfing candlestick pattern with a new record high closing price. Given the reaction so far this week, the bulls remain in charge. Confirmed breakouts of two rising channels provide a similar bullish assessment of current demand.
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