Early in the American session, Gold is trading around 2,378.27, above the 21 SMA, and above 4/8 Murray with strong bullish movement after reaching the low at 2,349 yesterday.
Yesterday, gold reached the bottom of the bullish trend channel which set the stage for an upward movement. After this technical correction, gold can continue its rise to 2,385 and 2,391.
Gold is now approaching a major daily resistance of around 2,384, so a technical correction below this area is likely to follow. If gold falls below this area, it could encourage the bulls to resume buying provided that it consolidates at about 2,371.
The metal left a GAP at about 2,391. Thus, the instrument is expected to reach this area in the coming days and can cover it. Therefore, we believe that a break above 2,384 could favor the bullish movement and gold could reach 2,391 and even the psychological level of 2,400.
Given that gold is overbought on the H4 chart, we believe that a technical correction from current price levels could enable a rebound in the price because the bullish trend still prevails.
