Gold prices are poised to potentially reach their all-time high if the current upward momentum sustains. The precious metal received a boost from softer CPI data and expectations of more dovish interest rate adjustments, with the market anticipating two full rate cuts by year-end.

Previously, gold had been declining within a bearish channel, but the CPI data acted as a catalyst for a potential bullish continuation. Yesterday’s daily candle closed above the trendline resistance (the upper bound of the channel), indicating a possible revival of the longer-term bullish trend.

Key points to monitor include a possible retest of the previous resistance, now acting as support, which is common in breakout scenarios. This approach helps avoid false breakouts that can mislead traders. Watch for the $2360 level to hold, as it aligns with the 1.618% Fibonacci extension of the 2020-2022 major decline and roughly matches the prior resistance trendline.

GOLD BREAKOUT ATTEMPT – BULLISH CONTINUATION PLAYS IN FOCUS

May 17 2024

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