Gold Price Forecast: New Highs and Potential Targets Ahead

Gold follows through to the upside on Thursday, with a bull breakout into new record highs. The day began at support around the 20-Day MA, which subsequently led to a launch out of a tight three-week consolidation range to a new record high of 2,559 (at the time of this writing).

Recently, the range has begun to take the form of an ascending triangle that reflected improving demand. The results are being seen today. Trading continues near the highs of the day and gold is set to end today’s session in a strong position, near the high of the day’s range.

Breaks out of Rising Consolidation Pattern

Since the April peak gold has been essentially trading in a rising consolidation formation. First, there was a rectangle pattern, followed by a symmetrical triangle, and culminating with a small rectangle that evolved into an ascending triangle formation.

These patterns may have set the stage for accelerated upward momentum beginning with today’s breakout. They are consolidation patterns that show improving momentum given that they got shorter as time went on and there was a progression to higher price zones as they developed.

Measured Move Points to 2,723

Notice the sharp advance that culminated with the April peak of 2,431. That high completed a 447 point or 22.5% advance from the February swing low in 41 days. The accelerated portion of the rise began on February 29 with a bull breakout of a symmetrical triangle formation. Alternatively, when starting the measurement of the rally from the low of that day to the April peak, gold advanced by 403 points or 19.9% in 30 days. Might gold see a similar measured move with the current breakout? There are a couple ways to look at it.

Could Gold Eventually Reach 3,011?

When starting a rising ABCD pattern from the February swing low to the April peak for the AB leg of the pattern, then adding that distance in price to the May swing low, an initial target from the pattern is identified at 2,723. However, if today’s low is used as a starting point and the measured move starting from the March 1 low on a percentage basis is added to it, a potential upside target of 3,011. This is not a prediction, just analysis to be aware of.

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