Reversal Follows Test of Pattern Targets
Gold triggered a one-day bearish reversal on Wednesday as price fell below $3,626, triggering a shooting star candlestick pattern. The session established both a lower daily high at $3,657 and a lower low at $3,619. This reversal comes immediately after a test of resistance marked by two rising ABCD pattern targets, completed with Tuesday’s record peak of $3,675.
First Potential Pullback After Breakout
Since the breakout to new record highs on September 2, gold has shown almost uninterrupted strength, with only one prior one-day pullback before momentum quickly resumed. A similar recovery is possible again, but price behavior now suggests the market may be ready for a deeper pullback or consolidation. The advance from the $3,311 swing low to Tuesday’s high represented an 11% gain, or $363, over just 14 trading sessions — a steep rise that increases the odds of further profit-taking before bullish continuation.
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Key Support Zones to Watch
The first potential support area sits near this week’s low of $3,576, but if that level fails to hold, the 38.2% Fibonacci retracement at $3,537 is the next key zone. Below that, the prior record high of $3,500 comes into play, coinciding with the 50% retracement at $3,495. A stronger support zone rests lower, spanning the $3,451 and $3,439 swing highs that defined the prior symmetrical triangle pattern. This lower range aligns with the 61.8% retracement at $3,452 and is reinforced by dynamic support from the 20-Day moving average, now near $3,450 and rising.
Bigger Picture Still Bullish
While a pullback appears likely, the broader outlook for gold remains firmly bullish. The first test of the 20-Day average should attract buying interest and help maintain the uptrend. Only a decisive drop and sustained trade below the 20-Day line would weaken the bullish structure as it looks now.
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See all Gold forecastsWeekly Close to Confirm Strength
With two trading sessions remaining this week, the closing price for the week may matter. A weekly close back under last week’s $3,600 high would show a failure to confirm the breakout, while a strong close above that level would reinforce the longer-term bull trend.
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