Early in the American session, gold is trading around 4,254, reaching a new all-time high and approaching daily resistance at around 4,266.
In the coming hours, gold could continue its rise to reach 4,270, a strong resistance level where the weekly resistance level 3 and the daily resistance level 2 are located.
If gold encounters a barrier in this area, it could be seen as an opportunity to enter short positions, as we could expect a technical correction to reach the 21SMA, located at 4,223.
If gold falls and sharply breaks the uptrend channel, which has been underway on the H1 chart since October 10, and consolidates below the 7/8 Murray and below the 21SMA, we could expect a strong technical correction. The instrument could reach the 200EMA around 4,070.
Gold has bullish potential. Hence, we could expect it to reach the top of the trend channel around 4,331. If it continues to rise, we could expect it to reach the 8/8 Murray around 4,375 in the coming days.
Technically, gold is overbought on the H4 and daily charts, so a significant technical correction is expected in the coming days. Gold is likely to fall to the psychological level of $4,000.
