GOLD: Retesting support will lead to a riseHello to all dear traders, Lucas_Reid here!
Gold has now broken upward out of the wedge and confirmed the recent bullish momentum. A major player is building a trading position above the wedge and is ready to distribute. But the main question is: how long will it last?
Basically, the recent surge in gold prices is due to the tensions in the Middle East and the large-scale missile exchanges between Iran and Israel – attracting safe-haven inflows. Interestingly, gold slightly declined at the end of Friday’s trading session, hovering around $3,368 at the time of writing (which is generally reasonable after the spike). However, the broader macro context still supports Gold in the medium term, with continued demand from central banks and persistent geopolitical risks providing support.
In addition, the Dollar is in a global downtrend and traders are waiting for a decision from Powell (who is under pressure from Trump to cut interest rates).
From a technical perspective, if we look at the big picture, we can see that buyers are in control, suggesting a continuation is likely. The price has broken out of the recent consolidation. The subsequent move was followed by consolidation and a reaction above the breakout level. Theoretically, we can speculate that major players are building positions above the current wedge. This can only imply the possibility of future deployment (distribution).
BUT, failure to stay above this level could invalidate the bullish scenario and increase the likelihood of a retracement toward the lower boundary of the channel.
Sincerely,
Lucas_Reid!
