XAU/USD Gold has potential (Updated)Hi everyone, this post is written to improve and update my previous idea on Gold. You can check my previous idea... but this post will cover it all anyways. To skip the long read, I've summarized the idea at the end.
I'll start with a broad overview to keep things clear...
And as time passes, and gold plays out, I will update the post to include more solid ideas.
This time, I've zoomed out the older snapshot from the other post since gold is trying to break out of this 10-year trend.
In my understanding, recently politics are getting heated, more and more people are turning their capital into Gold. And given that it is already at an all-time high, it is possible that this trend can be broken.
With that said, this post will solely investigate the technical analysis aspect of Gold.
I'm writing this idea to predict whether the ongoing bullish behavior will continue or not, rather than to find an entry point.
In my previous analysis, this was the general trend over the long term (almost 10-year trend). It showed resistance as I expected (2450). Of course, it is such a strong trend and sell pressure was expected. 1st time it got rejected at 2450 but after 1 months of recession, recently Gold fired back up to 2500 for the 2nd time. And as of right now, it is trying to break out of this 10-year trend.
If it does continue going up, 2700$ is where I am expecting to see some actual resistance.
To confirm this as a breakout I have looked at the possible uptrend driving the price which I've approximately shown as the pink trend, within the 10-year trend.
Inside the pink trend, the trend shown with white is the bullish trend that started in 2023 and is going on since. This trend does also indicate that with the current momentum, reaching 2700$ is possible. But we have to keep track of the price as Gold may face some resistance between 2545-2575$ as stated on the next image.
This is the YTD view.
Within the white steep uptrend, I believe Gold is currently rising within the channel shown. Pink line shows approximately the upper boundary of the bigger trend from the previous view.
Recently Gold gained pace and even broke out of this pink resistance zone, starting another uptrend after months of trying. We can't be certain of anything at the moment.
For the time being, I won't go into more short-term analysis, because more information is needed and currently it has a clear upwards momentum. If we do indeed reach around ~2570 than a more detailed lower timeframe analysis can be helpful to see if it can continue moving up.
I will update this post from time to time, as more information is necessary.
Predictions,
today, Aug 20, some resistance around 2530$
2-3 day target 2545-2550$
overall target;
if it does continue bullish 2700$, and in years target (~4000?)
Just to keep in mind,
If it fails to keep these levels and a reversal happens, It is possible that for months it can go back to 2200$ for a retest.
Even though I think it is less likely, if a lot of sell pressure happens and the pink trend cannot be broken. More sell pressure will be added when Gold falls below 2400$ and eventually can end up following a trajectory like this.
In either case Gold has huge potential on the long run, and I don't think it is wise to risk shorting Gold anytime soon.
Please do your own research before taking any risks.
