Tuesday’s Pullback Action
Gold retraced on Tuesday to a daily low of $4,164, triggering a one-day bearish reversal and carving a slightly higher swing high from Monday’s $4,264 level. The decline landed directly on the upper boundary of the long-term rising channel—confirmed as resistance only last Wednesday and Thursday—demonstrating textbook retest behavior after Friday’s breakout above that same line.
Bull Trend Remains Dominant
The larger uptrend stays fully intact with price well above all key moving averages and Monday’s higher swing high preserving short-term bullish structure. Standard post-breakout consolidation is testing prior resistance as support, exactly as expected in a healthy advance. This suggests a resolution to the upside.
Support Levels in Play
Immediate dynamic support sits at the rising 10-day average ($4,146), with greater significance at the 20-day average ($4,111) where it recently merged with trendline support. A daily close below Monday’s $4,205 low would confirm short-term pressure towards the 10-day average and worse case the 20-day zone.
Breakout Confirmation Required
Friday’s symmetrical triangle resolution coincided with a rare convergence of two upper channel lines plus the triangle boundary itself—adding weight to the breakout’s potential. However, true confirmation still requires a daily close above the November high at $4,245 and the fresh swing high at $4,264. An earlier bullish tell appears on a rally above Tuesday’s high.
Upside Objectives
Clearance of $4,264 targets an initial measured move to $4,356, equaling the price gain of the first leg up from October. A 127.2% projection of the current second leg points higher to a new record high near $4,454—both levels are realistic if the triangle breakout proves durable and momentum reaccelerates. Above there is a 127.2% extension at $4,516.
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The $4,164 low successfully respected the long-term channel line, keeping the bull case intact and the pullback within normal parameters. Hold above $4,205 and reclaim $4,245–$4,264 to resume the path to $4,356 minimum and $4,454 longer-term. Until then, expect two-sided chop with support at the 10-day and 20-day averages; only a decisive close below the 10-day average would raise legitimate near-term caution.
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