Autochartist has identified a possible launching point for gold futures as precious metals held steady to being the trading week. The narrow sideways action in Monday's session conforms to a retest of Key Level support, as indicated by Autochartist and illustrated here on the 30-minute candlestick chart.
Last week's swing high occurred after buying interest re-entered the market at the key level of $1,776 per ounce, and a $30 rally ensued to retest the $1,800 level. This move completed an earlier breakout pattern and initiated mild profit-taking to carry the price back to the key level support.
Gold is now setting a base directly above this level, which will make it a meaningful point on the chart to anticipate short-term direction. Momentum buying out of the congestion area (which may be forming into a longer term Triangle chart pattern) could send the price back to last week's highs, with follow-through from there confirming the uptrend.
A closing price significantly below this key level would indicate renewed weakness in the market. This development would lend weight to any downside breakouts from the short-term chart patterns identified by Autochartist.
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