Gold’s Countertrend Rally Hits New Trend High, but Resistance Kicks in for a Pullback

Gold climbed to a new trend high to start the day and maintain its rebound from the most recent swing low of 1,893. When resistance was achieved at today's high of 1,935, the precious metal was forced below yesterday's low of 1,919 as a result. As a result, gold has had an outside day and is currently closing in to the day's lows, which suggests that there could be a further decline. Natural gas is currently falling approaching the 50% Fibonacci retracement at 1,914 after a 38.2% Fibonacci retracement was completed.

Bullish Reversal Signals for the Week, but More Evidence Is Needed

As price climbed beyond the high of the previous week at 1,933, a bullish reversal weekly hammer candlestick pattern was also set off by today's increase. However, until there is a daily close above that weekly high, that breakout has not yet been verified. Once confirmed, it should be important since it will mark the first time since the bearish correction started nine weeks ago that the preceding week's high has been surpassed.

Gold Must Cross 1,942 for a Clearly Bullish Signal

If gold again rises above the high from last week, there are a few price levels to keep an eye on. The first is historical support, which spanned around a month of price movement that was largely sideways. There will be 1,937 people available for support during that time. As a result, resistance could be seen there on the way up. The 34-Day EMA is also helpful and is at 1,942. It exhibited resistance during the most recent consolidation phase on numerous days, either explicitly or generally. The market is asking us to pay attention to the 34-Day line by doing this. Although a daily close above the first level at 1,937 is a sign of strength, the 34-Day line should be viewed as a more important price level due to how close it is. Gold will also have confirmed strength on a closing above last week's high once there is a daily close above the 34-Day EMA.

Long-Term Uptrend Is Still Present

The gold price is expected to continue its upward trend, which started from the swing low of 1,615 on September 28, in the intermediate term. Gold has since increased 28.9% from that level to the trend high in May of 2,082. It has a decent potential of rising higher once more to eventually challenge and then surpass the previous record high if it maintains its position above the 200-Day EMA, which is currently at 1,897.