Gold's Technical Outlook: Consolidation Near Peak
As appraised during the last market session, gold’s position remains bullish, although the Federal Reserve announced that it won't be cutting rates soon amidst a higher-than-expected Consumer Price Index (CPI). The uncertainty brought by the higher-than-expected CPI and upcoming FOMC meeting adds a bullish undertone to the precious metal as investors seek safe-haven assets.
Technical analysis: The technical structure on the 4-hour chart shows gold consolidating after its ascent to new heights, now encountering resistance at the top of the current triangular formation. The consolidation phase is underscored by the contracting price action between the new all-time high at 2190 and its previous ATH at 2146, suggesting an impending volatility breakout. The ‘all-time high’ level serves as a testament to gold’s past bullish momentum, while the support at the 0.618 Fibonacci line around $2087 could provide a springboard for potential bounces. Should gold break above the new resistance, it may set the stage for new highs. However, a break below the current support could lead to a retrace towards the green ascending trendline, marking a deeper pullback within the broader bullish trend like, $2087.
Our position: Considering the latest CPI data and the impending FOMC meeting, we maintain a bullish outlook for gold. We see pullbacks to key support levels as buying opportunities, particularly if gold maintains stability above these zones. Our focus remains on the upper breakout of the consolidation pattern as a confirmation of bullish continuity. However, given the significance of upcoming economic events, we advise caution as they hold the potential to significantly sway market sentiment and price action.
Technical analysis: The technical structure on the 4-hour chart shows gold consolidating after its ascent to new heights, now encountering resistance at the top of the current triangular formation. The consolidation phase is underscored by the contracting price action between the new all-time high at 2190 and its previous ATH at 2146, suggesting an impending volatility breakout. The ‘all-time high’ level serves as a testament to gold’s past bullish momentum, while the support at the 0.618 Fibonacci line around $2087 could provide a springboard for potential bounces. Should gold break above the new resistance, it may set the stage for new highs. However, a break below the current support could lead to a retrace towards the green ascending trendline, marking a deeper pullback within the broader bullish trend like, $2087.
Our position: Considering the latest CPI data and the impending FOMC meeting, we maintain a bullish outlook for gold. We see pullbacks to key support levels as buying opportunities, particularly if gold maintains stability above these zones. Our focus remains on the upper breakout of the consolidation pattern as a confirmation of bullish continuity. However, given the significance of upcoming economic events, we advise caution as they hold the potential to significantly sway market sentiment and price action.
Trade active:
As expected, gold broke out of its bullish flag pattern, we set the stop loss above break even. we are taking some profits at last top. we are expecting further push upwards, but it depends on the economic data coming out this week.