Gold (XAU/USD) Price Forecast: Builds Toward Potential Breakout of Triangle

Continued Strength into Triangle Resistance

Gold extended gains on Wednesday, hitting a new 12-day high of $3,399 while advancing towards the upper boundary of a developing symmetrical triangle pattern. The move also cleared Tuesday’s high of $3,394, signaling short-term strength. The next immediate level to watch is the recent swing high at $3,409, which aligns with the triangle’s resistance zone. A daily close near the session highs would further underscore bullish momentum.

Triangle Structure Points to Imminent Resolution

Gold has been consolidating within the triangle for weeks, reflecting a pause in trend before a decisive move. Given its proximity to the pattern’s apex, a breakout is likely within the next week or so. The expectation is for an eventual upside resolution, consistent with the longer-term bullish trend. However, traders should remain aware that short-term consolidations often occur near breakout points, which could delay a sustained advance.

Upside Targets Beyond the Breakout

Should an upside breakout occur, higher initial targets include the $3,500 record high, followed by $3,578. A decisive move through that zone could trigger renewed momentum and signal a continuation of gold’s multi-month bull run. The 20-Day moving average is trending higher beneath price, providing technical support for buyers as the market approaches this key resistance test.

Risks of a Failed Breakout

While the technical setup leans bullish, the potential for a failed breakout must be considered. A rejection at resistance or decline back into the triangle following a breakout, could weigh on sentiment. The key support levels to watch are the lower boundary of the pattern and the recent swing low at $3,311. Any close below those levels would weaken the bullish outlook and potentially delay new record high attempts.

Weekly Chart Supports the Bullish Case

A bullish weekly reversal has already been confirmed this week with the move above $3,379. If gold closes the week above that level, the reversal signal will stand on the higher timeframe. This would reinforce the probability of an upside-breakout from the triangle and strengthen the case for a longer-term continuation toward new highs.

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