Gold rallies and $1,200 in focus

Last week’s suggestion to watch for any Flag breakout on Gold led to a potential 300 pips. The precious metal is looking bullish as the US$ stalls and this is what I’m watching for this week.

Last weekend I posted a 4hr chart of Gold showing a clear Flag pattern and suggested traders watch for any momentum-based breakout. This was the chart from that post:

This is how that chart finished for the week. The momentum-based Flag breakout did evolve and gave up to 300 pips before stalling at the $1,200 psychological level:

This week:

Gold monthly: still consolidating in a monthly Flag:

Gold weekly: there have now been three consecutive bullish weeks following the six bearish weeks:

Gold daily: watch the $1,200 level for any make or break activity:

  • Any bullish move above $1,200 would have me looking up to the two wedge trend lines with the higher one being near the $1,300 level.
  • A bearish retreat would have me looking to whole-number and previous S/R levels on the way down to the bottom wedge trend line.

Gold 4hr: there is another Flag pattern on the 4hr chart! This makes three consecutive weeks where the Gold 4hr chart has finished with a consolidation-style pattern! The latest 4hr Flag has formed up just under the key $1,200 S/R level so keep an eye on this resistance as well as watching for any momentum-based trend line breakout:

  • A bottom trend line breakout should evolve with the ADX and -DMI above 20. A bearish target mght be the $1,150 level as this is the 4hr chart’s 61.8% fib and is also previous S/R and near the monthly pivot.
  • A top trend line break should evolve with the ADX and +DMI above 20. If so, watch for any make or break at the $1,200 level. A target would be the $1,300 level as this is near the monthly/weekly chart’s wedge trend line.

Gold ETF: NUGT: 3x Bullish Gold ETF: I still like this for any close and hold above $10:

NUGT weekly: sitting just under the 410 level:

NUGT monthly: lots of scope for continuation:

 

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