XAUUSD at a Crossroads
G20’s final statement and the US-China trade agreements moved up the stock markets worldwide. Along, the Dollar weakened and Gold jumped up.
Gold started a correction starting on mid-April when an ounce of gold cost $1,364.4 at its peak. The correction ended in August with a bottom at $1,160.37. Since then the price has been moving on a slightly upward lateral channel. Then, starting on the final days of October its value has been making lower highs, inside a triangular pattern. That triangle has been pierced up today with a long, almost without shadows, candle that jumped straight to its recent tops.
Outlook
The question now is, has this lateral channel ended and the price continues its way down or are we just witnessing a new upward leg of this formation?
The MACD on its daily chart is inconclusive, as it is wobbling around its zero line, but the price is near the +2BB, which is bullish. Also, finally the price has made a new higher high and low. The 4-H chart is also bullish on price action and confirmed by its 4H MACD and Bollinger Bands.
As a final confirmation of this bullishness, we would like to see a breakout of the 1,235 level in the coming two days. Failure to do so will tell us that this is a short.-term strength and that more weakness are ahead.
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