Gold Price Analysis: Strong Reversal Candle and Key Levels to Watch for Continued Bullish Momentum

Gold Forecast Video for 03.07.23 by Bruce Powers

The rally off the bottom for gold picked up today as the precious metal jumped above yesterday’s 1,913 high and continued to advance. Yesterday, gold set up a potentially bullish doji hammer reversal candlestick pattern following a bounce off support around the 200-Day EMA. It triggered today with enthusiasm as gold broke above the high and trended up for much of the day.

At the time of this writing, it is on track to close strong, near the high for the day, thereby completing a long green candle. Upside follow-through and additional signs of strength will be key to determining whether yesterday’s 1,893 low is the bottom of the correction. Certainly, it is off to a good start given today’s bullish price behavior.

Close Above Six-Day High Signals Strength

There are a few minor price levels to watch on the way up, however a daily close above the six-day high at 1,937 will be most significant. At that price gold will also be above the 100-Day EMA. The area of the 100-Day line was clearly showing support on the way down as price stalled and consolidated there for several weeks. Given that history and the significance of a longer-term moving average such as the 100-Day, a daily close above the line will be a potentially significant sign of strengthening.

Weekly Bullish Candle

Moreover, after today’s session gold will have a new weekly completed candlestick pattern. At this point, it is looking like the week will end with a bullish hammer weekly pattern. A weekly bullish reversal signal would then trigger on a rise above this week’s high of 1,933, followed by a daily close above it to confirm strength.

Interim Price Levels and Monthly Bullish Candle

Following a daily close above this week’s high, with strength then further confirmed on a move above 1,937, gold first heads towards the 38.2% Fibonacci retracement at 1,965. This month’s high is 1,983 and is also a higher target. If gold can trigger a bullish breakout above June’s high, then upward momentum should accelerate as gold attempts to move again into new historical highs in the following weeks and months.

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