I reported a few weeks ago that the break to the 2018 high at $1367 could trigger a massive head and shoulders pattern with a target of $1700. I also said that from 2017 to 2019, the price had been forming an ascending pattern with a target of $1600. Both of these bullish patterns remain in play as the price has failed to trade back below the $1367 breakout-level.
However, in the short-term, the price has taken a break, but that could maybe come to an end in the next few weeks. In the short-term, gold prices are trading sideways between $1381, and the year-to-date high at $1439. The pattern in the short-term could be viewed as some sort of rectangle with a pattern of $1500 on a break to $1438. It can also be viewed as some sort of flag pattern, with a target of $1545.
The idea behind the flag pattern is that the up trust from $1274 to $1439 looks like a flag-pole, and the difference is then added to the base of the flag at $1381, which lands a target price of $1546.
Key for further gains is for the market to trade high enough and trigger them the new and shorter-term patterns, something I think may happen as the Federal Reserve is getting ready to cut rate. However, I don’t want to give this view too much leeway, and a slide below the $1381 level will cause me to abandon this bullish view.Don’t miss a beat! Follow us on Twitter.
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