Signs of Solid Support
This week’s lower price range shows several indicators that suggest its significance. The lower boundary of the uptrend channel aligns closely with the shorter declining channels. Support has held steady at every 50-day moving average, currently sitting at $3,162. Furthermore, the downward ABCD pattern reached $3,140, marking a near 100% target. With the downward trend and 50-day moving average providing dynamic support to the upward trend, any bullish reversal from these price levels indicates that this trend is likely to persist, unless there are clear signs of a bearish reversal.
Friday’s $3,252 Shows Bullish Potential
The move above $3,252 today suggests strength, implying that gold might be gearing up to test higher resistance levels. After hitting the lower end of the downward trend channel this week, there could be a final rally towards the upper boundary of that channel. However, the 20-day moving average presents initial resistance that must be overcome for higher prices to be viable. Currently, the 20-day line stands at $3,302.
Falling Below $3,121 This Week Feels Bearish
Even though support at this week’s low seems likely to hold, a drop below $3,121 could alter that trajectory. A continuous decline past $3,121 might signal a breakdown of the short-term bullish trend (seen in September’s low swings). Given the recent rapid rise to new record highs in gold, there’s a real chance for corrections and consolidation. Currently, it seems like this consolidation is confined within the downward channel.
For details on today’s economic events, refer to the Economic calendar.
