2,650 is the start of the next price range
The next target zone is revealed by the confluence of several price levels. Recently, there have been two ascending ABCD patterns with targets of 2,660 and 2,661. One pattern appears in purple and the other in orange. These mark the upper end of the price range. The range begins at 2,650, which continues the long-term retracement of the decline that began from the March 2022 peak.
Bullish reversal after Wednesday's weak close
Following the failure of a false breakout signal on Wednesday, today's rally confirms a bearish reversal suggesting a sell-off from the day's close. A bearish reversal candle was completed on Wednesday with a close in the bottom third of the day's trading range. Wednesday's low provides point C of a small ascending ABCD pattern with the first target being 2,675, just above 2,661.
The long-term upward trend is well underway.
Gold broke out of a multi-year base pattern in March and has been on the upswing ever since. Since this breakout, it has made consecutive monthly highs and monthly lows. The exception was June, which was an inside month and therefore had a lower monthly high. This bullish movement on the monthly chart and the steady uptrend that is expected after a long-term bullish breakout.
Accelerating momentum
Today's rise to record highs indicates that upward momentum is accelerating as gold moves away from the 20-day moving average (purple). This is also reflected in the increasing upward slope of the internal ascending trend line that has converged to the 20-day line over the past few days. Looking at the bigger picture, a higher objective for gold appears near 2,724. The rally began 447 points, or 22.5%, from the February swing low. The next rally measured from the June 26 swing low would coincide with a rally at 2,724.
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