As stipulated in my commentary a couple of weeks ago, gold did breach the key psychological level of $4,000 and continued lower to the first resistance level of approximately ~$3,889.
What’s happened since, however, is more a following of the first scenario:
Gold price action will form a base, consolidate, and stage another leg higher, aiming to overcome resistance held at ~$4,240
Technically, gold remains well supported at both $4,000 and $3,889, although a move below the latter could spell trouble for gold pricing, with the next stop being at the 50-period SMA.
To the upside, which bulls will be keen to hear, we can expect our next reasonable price target to be at the 20-period moving average, roughly at $4,090.
Otherwise, our secondary target would be at the previous support-turned-resistance level at $4,240, and then aim to surpass the all-time high of $4,381.
