Gold futures may have established a strong near term resistance level on the intra-day charts, opening the door for yet another sell-off from the current price range. Following a modest recovery from the steep losses posted at the start of the week, Gold crept higher to form a fairly basic Triangle chart pattern, shown here on the Autochartist 15-minute time interval.
Despite what appears to be a short-covering rally on strong momentum, Gold futures ran into a headwind around $1,334 per ounce, and have been unable to make any meaningful progress above that level. Numerous attempts to do so created the upper resistance trend line of the Triangle formation, and overall weak, sideways trade within the pattern indicates possible lack of buying interest in this range.
Tuesday's soft close executed a Breakout signal after breaching the support zone established by the bottom of the triangle. This creates an entry point for shorting the market, with a move back above the top of the Triangle pattern negating the trade. If the breakout confirms, the projected price target is forecast to reach a minimum of $1,328 per ounce, with the lower end of the range seen near $1,324.
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