Gold continued its upward momentum on Thursday, reaching a new record high of $3,175, surpassing its previous peak of $3,168. The highest daily closing price for gold stood at $3,131, and with the market trading near its daily highs at the time of this report, today’s closing price is likely to become the highest ever, confirming the strength of the ongoing bullish trend.
Two Consecutive Strong Up Days
Today marks the second consecutive strong upward movement for gold, evidenced by the wide range green candles on the chart. This raises the question: could a third day of gains follow, or will resistance levels cause a pullback before gold attempts another breakout? A third consecutive strong up day would form a “three white soldiers” candlestick pattern, signaling strong bullish momentum. However, for this to happen, gold must break decisively above today’s high to confirm further gains. Otherwise, the potential resistance could cause a pullback, keeping the price within Thursday’s trading range.
Higher Targets: $3,199 and Beyond
The next key resistance is at $3,199 to $3,205, an area which gold seems to be approaching as the market recognizes the rising trend channel since the December lows. This price zone represents a significant potential target. Beyond this, higher targets are seen at $3,232 and $3,250. These levels will be closely monitored as gold continues to push higher.
Second Breakout Attempt from Larger Channel
In addition to the short-term strength, today’s rally has sparked a second breakout attempt from a larger, long-term rising parallel trend channel (purple). Although the first breakout attempt last week failed, this second attempt has a greater chance of success. If gold sustains this breakout, it will likely continue its bullish trend within the smaller trend channel parameters, leading to further upward momentum.
Potential Support Levels on Pullback
In the event of a pullback, the top line of the purple channel (currently around $3,126) serves as potential support. This line is rising, so the exact price will change over time. Additionally, prior weekly highs at $3,087 and $3,058 may act as further support levels. Given the wide trading range established this week, any bearish pullback could lead to increased volatility, making it crucial for traders to monitor these key support areas.
Conclusion
Gold’s recent rally to new highs has put it on track for further gains, with potential targets of $3,199 and beyond. However, the possibility of a pullback remains if resistance levels hold. Traders should be aware of key support zones and watch for a decisive breakout above current highs for confirmation of continued bullish momentum.
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