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Navigating Resistance: Gold’s Rally Sets the Stage for Higher Peaks

By:
Bruce Powers

Bullish momentum strengthens as buyers drive gold's ascent, supported by a robust reversal from key support levels.

Gold bullion, FX Empire

In this article:

Gold Forecast Video for 15.11.23 by Bruce Powers

Following Monday’s bullish reversal, gold continued to advance today, reaching a four-day high of 1,971. Today’s high tested resistance at the five-day high of 1,971 and the prior swing high of 1,970, as gold looks to reclaim those price levels on the way back up. A strong close today should see a continuation of the bounce to higher price levels. The weekly high of 1,993 and this month’s high of 2,004 are the next higher price levels to watch for signs of resistance, or a breakthrough to higher prices. A strong close would occur in the top third of the day’s range, or above 1,962.

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Rising off Strong Support

Gold has risen from a support zone that includes the 38.2% Fibonacci retracement and the 50-Day EMA (orange). A bullish reversal that is sustained off the 38.2% retracement generally indicates strength and increasing demand. The support zone is considered a little stronger than it might be given the confirmation from the 50-Day line, which points to a similar price level. In addition, another sign of strength is the fact that today’s reversal day was strong enough to reach a three-day high and stopped just shy of a four-day high. This behavior reflects strong and growing demand.

For Now, Signs Point to Higher Prices

Today’s somewhat sharp advance shows buyers stepping up and momentum increasing as price rises. Of course, it is not clear yet whether the recent 1,932 swing low will be tested again as support or fail to hold another selloff. For now, the expectation is for a continuation higher to push up again a consolidation zone up to the highs of the recent trend high at 2,009.

New Trend High Will Have Gold Target 2,024 Price Zone

If the 1,932-swing low is a bottom, gold should eventually reach the next higher target zone from around 2,024 to 2,041. Therefore, there is a good chance that short-term weakness will be bought by traders looking to enter the market to take advantage of the next swing up. So, there is certainly a good argument for the recent swing low to be the bottom before gold looks to reclaim higher prices, starting with the 2,009-swing low.

For a look at all of today’s economic events, check out our economic calendar.

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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