Gold price has broken out of the short-term bearish channel we talked about yesterday and provided a new short-term sign of strength. Price is bouncing higher after the strong sell off from $2,070 to $1,894. Gold price has reached all our pull back targets. What now?
Gold price is bouncing and traders are confused whether the decline is over and a new upward move to new all time highs is starting. Gold price has to overcome the blue rectangle area which is important resistance. If bulls manage to start making higher highs and higher lows while breaking above the blue resistance area, then we should expect a new all time high to come over the next few weeks. A rejection at the horizontal resistance area will be a bearish sign and could lead Gold price to new lower lows below $1,894 towards $1,870 if not $1,850.
