Gold Bounces off Initial Retracement to Trigger Bullish Trend Continuation
Gold Forecast Video for 24.03.23 by Bruce Powers
Gold triggers a bullish reversal off support following a short three-day pullback. Buyers stepped in at yesterday’s low of 1,934 before gold closed green and up for the day. During the pullback a 38.2% Fibonacci retracement was completed indicating that gold was in a logical place to see bullish sentiment return. Subsequently, today, gold breaks out above yesterday’s high of 1,979 in a challenge to the recent swing high of 2,010. Given this price behavior and the trend structure gold is signaling it wants to go higher.
38.2% Fibonacci Retracement Complete
Seeing buyers step up at the 38.2% retracement rather than a deeper Fibonacci retracement level is bullish. Subsequently, a new bullish reversal signal confirms the suspected strength and increases the chance for a continuation of the trend, higher in this case. A decisive advance above this week’s high of 2,010 provides the next bullish signal.
Resistance Seen at Recent High Could Be Seen Again
At the same time, resistance was seen at the recent high and it could be seen again. The high was just shy of the 88.6% Fibonacci retracement and hitting a top trendline across the highs of recent price action including this week’s high. You can see how price could go still go higher yet continue to find resistance around the top trend line.
Measured Move Provides Additional Evidence for Resistance
Additional indications for possible resistance near the recent high include the completion of a measured move where the current advance matches the first sharp advance in the beginning of the uptrend. The uptrend began off the November low (1) where the first leg up in the trend advanced by 10.5% within eight days. The current leg up, starting off the March 8 low completed an 11.0% advance also in eight days. This reflects symmetry between swings within the price structure.
Breakout to New High for Gold Targets Prior Historical Highs
In the scenario where gold rallies decisively above the recent high, as well of the top trend line, gold next heads towards a variety of unconfirmed Fibonacci levels (88.6% is at 2,018) and previous swing highs (solid purple horizontals). The first is from August 2020 at 2,031, followed by the historical high of 2,070 from March 2022.
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