Gold Price Forecast: Hits Record High, Eyes $3,004 on Strong Momentum

Bullish momentum in gold accelerated on Thursday as it broke out to a new record high of $2,985 before stalling. Trading continues near the highs of the day at the time of this writing and gold could go higher before the end of today’s trading session. An initial new high target zone from $2,978 to $2,982 was reached and exceeded slightly, a sign of strength.

A strong daily close in the upper third of the day’s trading range will keep gold in a position to continue higher. The start of the initial target zone at $2,978 was derived from a rising ABCD pattern, while the 127.2% extended target for the pattern is higher at $3,004. Nevertheless, there is an interim target at the 127.2% Fibonacci extension of the most recent bearish correction begun from the February peak.

Multiple Bullish Indications

Keep in mind that targets are all potential prices if certain things happen. For gold, a daily close above the $2,982 level shows strength that could lead to further upside in the near term. Today’s bull breakout was decisive and showed strong upward momentum. Moreover, a bull breakout of an inside week triggered this week, as well as a bullish monthly signal.

The last advance following a bull breakout of monthly consolidation in March of last year, was followed by a seven month advance until the recent $2,790 high. Although that might not happen this time, it shows the potential for higher prices. Also, bullish indications show the potential for a new phase to the uptrend. This means that pullback lower could lead to new entry setups to take advantage of the continuation of the rising long-term trend.

If Pullback, Could Test $2,956 Support

The reclaim of the 20-Day MA yesterday and successful test of support of the line with the low of the day, prepared the launch. A new high breakout just began and a new rally above the 20-Day line. Further, during the recent bearish correction the 20-Day went flat over the past week or so, but it did not turn down. It is now starting to turn up again. If a decline comes before new highs, key potential support levels, marked by the confluence of price levels on the chart, are around $2,956, $2,945, and a range from $2,936 to $2,930.

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