Gold (XAU/USD) Price Forecast: New Record $4,498 – $4,552 Extension Next

Tuesday’s Record Extension

Gold extended to a new record high of $4,498 and looks set to end Tuesday’s session in a similar bullish position as trading continues near the highs of the day at writing. Tuesday’s advance extended from a Monday breakout to a new record high, confirmed by a strong closing price near the highs of the range, plus a ending above the prior trend high breakout level of $4,381. A new high daily closing price on Tuesday will further confirm bullish momentum and the potential for a continuation.

Emerging New Leg Higher

Nonetheless, the next potential short-term target is at a 127.2% extension of the most recent correction at $4,552. But given the larger bullish indications, a new leg up is likely in progress. This week’s new high breakout follows eight weeks of establishing an angle of ascent that shows strong demand. Having said that, a second upside breakout recently from a rising trend channel suggests that bullish momentum indicated by the slope may have entered a new trend environment. If correct, higher targets beyond the extension start with a 161.8% ABCD pattern projection at $4,578. Then, a long-term target zone follows around $4,664 to $4,687.

Comparison to Silver’s Pattern

This might be like what has occurred in silver recently. Silver is in its fourth week of higher highs and lows following the breakout to a new trend high. An upside breakout of a rising channel confirmed the second week after the initial breakout four weeks ago. In other words, a sustainable rate of change followed the channel breakout.

Constructive Pre-Breakout Pause

What is promising about Monday’s breakout is that it triggered following six days of a relatively tight sideways pattern. Rather than momentum exhausting following a new high breakout, a pause should have helped demand build to where support holds on a pullback. The initial key support range starts with the prior high of $4,381 and goes to Monday’s low of $4,338. The 10-day average is now at $4,336 and will shortly be above the low of the range. It represents key dynamic support that should hold during weakness. If gold stays above the 10-day average the short-term bull trend remains.

Outlook

Gold has launched a convincing new leg higher with the second channel breakout and sustained push to $4,498, mirroring silver’s sustainable acceleration. Hold the rising 10-day average near $4,336 on any weakness to keep momentum intact; clearance of $4,498 targets $4,552 short-term and $4,578–$4,687 longer-term in the emerging bull environment.

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