Gold fighting to break the head n shoulders pattern


Bullion woke up on Tuesday, and it erased Monday's losses, with the metal trading 1% stronger ahead of the US session, last seen at around 1,845 USD.

The price is now trying to break the critical resistance of 1,850, where previous highs and lows are located. That is also the right shoulder level, and if the price breaks above that resistance, the head and shoulders pattern might be invalidated. 

Therefore, the 1,850 USD level will be the key level for today's trading. If bulls are successful, gold might continue higher, targeting December highs of 1,870 USD.

Alternatively, if gold fails at the mentioned resistance and a decline occurs, the medium-term downtrend could be confirmed. This formation's full potential is circa 60 USD, so that it might send the bullion toward 1,760 USD. 

The formation's neckline is seen at 1,820 USD, which is a must hold support for bulls. 

However, as we have said many times previously, the fundamental situation remains very bullish for gold and silver, so it is a mystery why the metal has been such a loser recently. 
Cookie Policy: The Axiory website uses cookies and by continuing using the website you consent to this. Risk Warning: Trading leveraged products such as Forex and CFDs may not be suitable for all investors as they carry a high degree of risk to your capital. Please read the full Privacy Policy.