The price of gold rallied in the last hours also because the Dollar Index crashed. Fundamentally, Japan intervened in the FX market to support the JPY. This could be the reason why XAU/USD registered an aggressive rally. Technically, after its larger drop, a rebound was somehow expected.
Today, the US Federal Budget Balance came in at -429,7B versus -173.5B, while the Canadian Retail Sales and Core Retail Sales came in better than expected.
XAU/USD Strongly Bullish!
As you can see on the H1 chart, the rate failed to stabilize below 1,623 and now it has rallied. It has registered a valid breakout through the downtrend line and above the median line (ml) and now it has passed above 1,645 key resistance.
Stabilizing above these levels may signal further growth. After this amazing rally, the rate could come back to test and retest the broken levels.
XAU/USD Forecast!
The current breakout may signal that the downside movement could be over and that XAU/USD could develop a larger rebound. Confirming its breakout above 1,645 could announce further growth and could bring new long opportunities with a first upside target at 1,668.
