Gold futures resumed their upward climb in last week's trading, moving significantly above the $1,700 per ounce key level support. The overall chart analysis suggests the buyers are still in command of this market as the steady climb has yet to see any meaningful price retracement. While this bodes well for the longer term, Autochartist has detected a formidable resistance level at the $1,740 level which did manage to cap the week's gains.
After marching steadily higher in the uptrend phase of a Channel Up chart pattern, gold pulled back softly to set up a pivot point within the formation. The $30 per ounce span between the support and resistance trend lines that form the Channel Up creates a large potential trading range, while the lack of retracements so far suggest the pattern may still be in a fairly early stage of development. This is partially reflected in the average internal rankings for Quality, Uniformity, and Clarity. A continuation of range-bound trade within the channel will likely improve the rankings and become the dominant pattern for traders to position against.
Alternatively, follow-through momentum may enter next week's trading to puch the price above $1,740 per ounce and above the channel's trend line resistance. This would signal a premature breakout from the emerging pattern and signal a decisively bullish forecast for a commencement towards $1,800 per ounce once again. For further information on this and other Autochartist products, visit our website at www.autochartist.com
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