Gold escapes from the range. You know what it means...
One of the most notable market events this week was renewed Gold momentum, sending price to a new 2020 high.
It looks like bulls and bears argued for two months about the direction as the price stalled in the range between key levels of $1680 - $1745. Finally, sellers capitulated. Last month, around May 18, a failed breakout took place - it is clear that the price failed to gain a foothold above the upper bound.
Now the chances that the breakout is successful are much greater. We can see that there was a rebound from the ex-resistance converting it into support. Also, higher low followed in the price action adding evidence to the truth of breakout. Such behavior tells us that the market has come to consensus about the validity of the breakthrough - sellers realized they made a mistake betting that resistance would hold, buyers became more confident that their decision to buy was right.
Breakout from a range is usually the signal of initiation of a trend. As the gold price quitted 2-month range, the base scenario is now bullish trend with next target at $1800.
And what are your thoughts about Gold? Let me know in comments
It looks like bulls and bears argued for two months about the direction as the price stalled in the range between key levels of $1680 - $1745. Finally, sellers capitulated. Last month, around May 18, a failed breakout took place - it is clear that the price failed to gain a foothold above the upper bound.
Now the chances that the breakout is successful are much greater. We can see that there was a rebound from the ex-resistance converting it into support. Also, higher low followed in the price action adding evidence to the truth of breakout. Such behavior tells us that the market has come to consensus about the validity of the breakthrough - sellers realized they made a mistake betting that resistance would hold, buyers became more confident that their decision to buy was right.
Breakout from a range is usually the signal of initiation of a trend. As the gold price quitted 2-month range, the base scenario is now bullish trend with next target at $1800.
And what are your thoughts about Gold? Let me know in comments