Gold rallies after failing to retest the $1,900 psychological level as the DXY (US Dollar Index) remains in the bearish territory. The yellow metal is trading at the 1,914.39 level at the time of writing and it seems strong enough to approach and reach new obstacles, targets.
The US is to release the ISM Manufacturing PMI which represents a high-impact event. The indicator is expected to increase from 60.7 to 60.8. A potential growth registered by the US Dollar Index after the US data release could bring some selling pressure on Gold.
XAU/USD Strongly Bullish!
Gold is approaching the weekly R1 (1,919.87) level which is seen as a static resistance. The ascending pitchfork's upper median line (uml) represents a major upside target.
Its failure to reach and retest the median line (ml) signaled strong buyers and potential further growth. Also, the failure to reach the S1 (1,879.82) indicated a bullish movement towards the R1.
Gold ignored the $1,900 psychological level, so more gains are favored. It remains to see how the price will react at the R1 (1,919.87) resistance.
Forecast!
The false breakdown with great separation through 1,890.14 followed by the aggressive breakout above the 1,900.00 level suggested a long opportunity. Now, we have to wait for a temporary decline or for a short-term consolidation before going long again.
Gold could decline a little if the US Dollar will start increasing again versus its rivals.
