Gold Dips to Three-Day Low, but Uptrend Remains Intact

Gold Forecast Video for 28.04.23 by Bruce Powers

Gold maintains its uptrend but remains at risk of moving into a deeper retracement. Again today, support was tested around recent lows as gold dipped to a three-day low of 1,974. An intraday bounce brought it back up from that low above the small uptrend line at the bottom of a rising channel. A daily close below the uptrend line, estimated at 1,983, would provide the next minor bearish sign if it was to occur.

Weekly Chart Provides Better Price Levels

Further, given the relatively sideway price action from the past eight trading days, a weekly chart may provide more reliable price levels to key off. So far, this week gold has traded within the range of the prior week. An inside week represents consolidation. This can also easily be seen in a daily chart.

Since this week is not yet complete, a move through the high or low of this week would tell us something about whether gold is strengthening or weakening, but not provide as clear of a signal as a completed week. This is the case until next week. At that point, this week’s high and low will be complete and therefore provide more significant price levels. To date, the high of this week is 2,009 and the low is 1,974.

Bearish Monthly Candle on Track

There is only one more trading day left in April with the current monthly candlestick pattern showing a potentially bearish shooting star. Obviously, this is a larger time frame and therefore potentially more significant should a breakdown occur. A drop through the bottom of the month (1,950) would give a bearish signal, which would then confirm on a daily close below that price level. That monthly low is also the low of a daily support zone that starts from the two-week low at 1,969.

Test of Trend High Possible Following Signs of Strength

A move higher and above this week’s high is a sign of strengthening. Gold has the potential to test the recent high of 2,049 before moving higher to the record high of 1,959 from March of 2021. If that high is exceeded gold will be on track to complete an ABCD pattern that starts from March 2023 swing low.

For a look at all of today’s economic events, check out our economic calendar.