Gold has rallied today as the Dollar Index has dropped. DXY's sell-off was somehow expected after its amazing growth. Also, some poor US data have forced the greenback to depreciate versus its rivals. The price of Gold has taken advantage and it has risen as much as 1,764 today.
Now, the yellow metal has reached a resistance area, so you'll have to be careful, anything could happen. Being rejected from this zone could push the price down again. On the other hand, Gold could extend its upwards movement if it makes a valid breakout through the immediate resistance levels. XAU/USD registered a 2.44% growth from 1,722.29 today low to 1,764.24 today's high.
XAU/USD Amazing Upside Momentum!
As you can see on the H4 chart, the price of Gold failed to stabilize under the weekly S1 (1,729.88) signaling bullish pressure. Now it challenges the 1,758 weekly pivot point after failing to stay above the ascending pitchfork's median line (ml).
It has failed to reach the downtrend line. You should know that only a valid breakout through the downtrend line may confirm further growth. A false breakout or failing to reach this line may signal a new leg down.
Gold Forecast!
Jumping, closing, and stabilizing above the downtrend line and above the median line (ml) could be seen as a long opportunity. This scenario could signal an upside reversal. Staying under the downtrend line and coming back below 1750 may signal a downside continuation.
