Gold Struggles as Momentum Falters

Gold Forecast Video for 11.05.23 by Bruce Powers

Gold continues to advance within a rising parallel trend channel as today we have a higher daily high and higher daily low. Following a reversal off support of 1,999 last week, gold has risen as much as 2.4% as of today’s 2,048 high.

New AB=CD Pattern Target

A new AB=CD pattern using last week’s swing low for the C has been identified on the chart with a target of 2,112. Notice that the prior ABCD pattern, beginning from the March 22 low completed almost exactly at 2,082, one point away. This week’s low of 2,014 is near-term support, while last week’s low of 1,999 starts the more significant support zone, down to around the 34-Day EMA at 1,992.

Multiple Trendlines Converge to Highlight Target Zone

In addition to the upside target from the ABCD pattern, the price zone marked by the convergence of multiple trendlines further highlights this price area. The expanded target zone is from approximately 2,100 to 2,113. Momentum, measured by the relative strength index, is attempting to break out of a bullish flag pattern and supportive of higher prices for gold. The trendline was broken the other day but it is yet to stay above the downtrend line. Once it does, it will provide further evidence for a bullish continuation in gold. Note that 2,070 is the prior record high for gold exceeded by 12 points last week.

Fractal Natures of Markets

Gold is in an interesting technical position. If last week’s low is busted to the downside, it next hits the internal uptrend line that creates a wedge pattern inside the rising small channel, along with the top line of the channel. If it keeps falling, it reaches the lower channel line of the small channel, followed by the larger uptrend line at the bottom of a large parallel channel. So, we have a small parallel channel within a larger parallel channel, reflecting the fractal natural of the market.

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