In August 2020, the gold price reached an all-time high at US$2076/oz.
Since then, we have seen systematic declines separated by upward corrections.
- gold breaks out from the downward channel
- inflation supports investment in gold
The chart is within a fairly regular downward channel, which can also be called a bullish flag. Why bullish? Because a breakout from such a formation usually occurs upwards and is a continuation of the uptrend that gold has been in since 2015.
In March this year, a double bottom formation appeared and the price headed quite strongly towards the resistance of the flag, only to break out of it upwards in mid-May.
Currently, the uptrend continues and so far there are no signs of demand weakening.
The MACD oscillator on the daily chart points to further increases, but the price may stop at the nearest supply zone of 1935-45 USD/oz.
On the H4 chart, we note two signals indicating a demand advantage. The first is candle (1), where we see a strong demand reaction as the price re-tested the overcome resistance of the aforementioned flag. The second is candle (2), which forms a strong bullish engulfing.
Analyzing the current situation, a lot points to further increases, only defeating the local trend line may negate the upward scenario.
I recommend a description of the strategy used for this analysis: PA+MACD
ongoing analysis https://t.me/TradewithDargo
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