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Gold Price Forecast: Bullish Momentum Points to Potential Record Highs

By:
Bruce Powers
Updated: Mar 1, 2024, 22:25 UTC

Gold's breakout from a consolidation pattern suggests bullish momentum, with targets near record highs around 2,135 and a potential surge towards 2,190.

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Gold sees bullish follow through after yesterday’s breakout of a large symmetrical triangle consolidation pattern. So far, it is acting in a way that is very supportive of a bullish outlook. The precious metal took off and reached a high of 2,088 today before encountering resistance. That high completes the next target for gold, which was at 2,088 from the December 28 swing high (B). Gold is on track to close strong, in the top 25% of the day’s trading range.

A screenshot of a graph Description automatically generated

Strong Bullish Momentum Indicated

This week’s bullish breakout may be the beginning of a run that sees gold reach new record highs. The last record high was set in December at 2,135. It is off to a good start with this week’s price action. Clearly, upward momentum has improved as represented by today’s wide range green candle and likely strong close. Gold broke out of a bullish hammer candlestick bottom two weeks ago on the weekly chart, providing a solid beginning to this rally.

Next Higher Target is $2,100

The next higher price target above today’s high is up around 2,100. At that point a rising ABCD pattern completes. Symmetry between the two swings in the pattern, the AB leg, and the CD leg, will match at that point. Nevertheless, that is the first target from the pattern. Given the likelihood of still higher prices there is a good chance that the target will be exceeded. The 127.2% ABCD pattern target will then be at 2,138, awfully close to the prior record high.

New High Target Zone: 2,189 to 2,192

Since yesterday’s breakout, however, an eventual target derived from the symmetrical triangle becomes more likely. That target is around 2,189 and marked on the chart. What is interesting is what happens when we look at the two sharp rallies that occurred before the three-month consolidation pattern. Each of the rallies saw an advance of over 10%.

The first was 11% and the second 10.5%. If the current rally matches a 10.5% advance, which would make sense given the previous rallies, gold would be hitting approximately 2,192. That is a very close match to the triangle target. When two methods identify a similar target, that target zone takes on greater potential significance.

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About the Author

Bruce boasts over 20 years in financial markets, holding senior roles such as Head of Trading Strategy at Relentless 13 Capital and Corporate Advisor at Chronos Futures. A CMT® charter holder and MBA in Finance, he's a renowned analyst and media figure, appearing on 150+ TV business shows.

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