Gold made it four up days in a row on Friday for the first time in 6 weeks and hit a high of 1629. We identified 1625-1630 as a potential resistance zone and it has proved to be the case.
Although the market is in a shallow corrective retrace this morning, we expect the rally to resume shortly without a significant pullback.
Once the 1630 area has been taken out, the 200 DMA is the next target, followed by the upper boundary of the downtrend channel. Above this, the price should accelerate as momentum traders enter the market and shorts scramble to cover their positions.
Although the market is in a shallow corrective retrace this morning, we expect the rally to resume shortly without a significant pullback.
Once the 1630 area has been taken out, the 200 DMA is the next target, followed by the upper boundary of the downtrend channel. Above this, the price should accelerate as momentum traders enter the market and shorts scramble to cover their positions.