Gold prices are on an upward trajectory, approaching an all-time high of $2,942 per ounce as of Friday, and the precious metal is heading in a significant direction at the end of the week with gold prices falling by $1.52% after hitting a near record high, With the increasing global uncertainty caused by US President Donald Trump’s announcement of reciprocal tariffs, gold’s appeal as a safe haven has increased.
Technical Analysis
Technically, gold price action is showing signs of sustained bullish momentum. The precious metal continues to trade within a healthy ascending channel on the daily chart, which has been in place since December 31, 2024, with a reference bottom at $2,600.80. This channel has been marked by a clear pattern of higher highs and higher lows – an indicator of an aggressive bull market.
However, since February 10, gold’s bullish momentum has temporarily stalled, as the price failed to make new local highs. This pause has led to the formation of a resistance zone between $2,942.80 and $2,952.80, which could serve as an ideal selling zone for short-term traders. The lack of new aggressive higher highs has raised concerns that profit-taking may be imminent, which could lead to a correction in gold’s price.
To ascertain whether a bearish reversal is on the horizon, traders will be closely watching the lower area of the previous highs. A break below this level could signal the start of a short-term downtrend. On the other hand, if the current uptrend line remains intact and gold continues to make higher highs, the bullish momentum could continue, and new record highs could be within reach.
For now, the technical outlook remains generally bullish, with gold continuing to rally within its well-established ascending channel. A short-term correction is possible if the resistance area, the main area of the current uptrend, remains intact and bullish divergence remains intact - this would indicate that the uptrend is likely to continue.
Trading Recommendations
Technical Analysis
Technically, gold price action is showing signs of sustained bullish momentum. The precious metal continues to trade within a healthy ascending channel on the daily chart, which has been in place since December 31, 2024, with a reference bottom at $2,600.80. This channel has been marked by a clear pattern of higher highs and higher lows – an indicator of an aggressive bull market.
However, since February 10, gold’s bullish momentum has temporarily stalled, as the price failed to make new local highs. This pause has led to the formation of a resistance zone between $2,942.80 and $2,952.80, which could serve as an ideal selling zone for short-term traders. The lack of new aggressive higher highs has raised concerns that profit-taking may be imminent, which could lead to a correction in gold’s price.
To ascertain whether a bearish reversal is on the horizon, traders will be closely watching the lower area of the previous highs. A break below this level could signal the start of a short-term downtrend. On the other hand, if the current uptrend line remains intact and gold continues to make higher highs, the bullish momentum could continue, and new record highs could be within reach.
For now, the technical outlook remains generally bullish, with gold continuing to rally within its well-established ascending channel. A short-term correction is possible if the resistance area, the main area of the current uptrend, remains intact and bullish divergence remains intact - this would indicate that the uptrend is likely to continue.
Trading Recommendations
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.