Resistance Levels Define the Next Breakout Test
Another sign of strength would be indicated by a rise above Tuesday’s high of $4,181. That would put gold more clearly above both the 20-day average and the long-term trendline, which is currently positioned nearby. A close above Tuesday’s high would confirm strength by reclaiming both trend indicators. Next, a decisive breakout above $4,203 would be needed to trigger a bullish continuation, with the first primary target anchored by the falling 50-day moving average, currently at $4,362. Both the 50% retracement at $4,358 and the 127.2% Fibonacci projection for a small rising ABCD pattern near $4,354 provide additional confluence.
Bullish Setup Faces a Critical Support Test
Conversely, if dynamic trend resistance continues to hold, the recent bullish reversal attempt could fail. A drop below Thursday’s low of $4,054 and Wednesday’s low of $4,021 would weaken the developing higher swing low structure. That could lead to another test of support near the corrective low of $3,942 or a decline toward the next lower support target zone of $3,886. Therefore, the ability of gold to reclaim nearby resistance levels will likely determine whether the recent bounce evolves into a broader recovery or another leg lower within the correction.
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Source: Original Article
