Gold Price Forecast: Breakout Targets $4,852 and Beyond

Gold Reclaims Key Near-Term Resistance

Gold advanced above a key near-term resistance zone on Thursday, reaching a four-day high of $4,511 and rising above the downtrend line and 20-day moving average. A break above the downtrend line triggered last week but did not confirm as resistance during the subsequent pullback that fell below the line.

Nonetheless, a second recovery of the trendline is bullish, especially when it occurs with a reclaim of the 20-day moving average at $4,461, concurrently. A daily close above Monday’s high of $4,472 would confirm the near-term bullish signals.

Resistance Turns Into Support

Wednesday’s low of $4,282 is now a higher swing low, which is bullish. Consequently, Thursday’s advance confirmed support near the uptrend line after it had represented resistance for about a month recently. That switch from resistance to support is also bullish.

Next Test Could Shift Long-Term Outlook

Altogether, recent technical signals show the possible beginning of an uptrend. If gold can now rise above and stay above the 200-day moving average near $4,534, the long-term picture should improve. That would likely lead to a continuation of the current advance above last week’s high of $4,697, thereby triggering a continuation of the developing advance.

ABCD Pattern Points Toward $4,984

With a new swing low, a potential rising ABCD pattern has formed, which shows an initial 100% projected target near $4,984. That is where there will be symmetry in price between the two legs up from the recent bottom. Typically, that projection identifies a minimum resistance target derived from the rising ABCD pattern. Given the potential upside indicated by the pattern, two lower targets become more likely to be reached.

There is the 50% retracement of the prior full decline at $4,771, and the 61.8% Fibonacci retracement at $4,852. Both of those areas are reinforced by a prior lower swing high, with the higher level showing greater significance given the series of lower swing highs in the prior downtrend.

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