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For the first time, Gold finally closed above 2085. Is this bullish for a break?
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There have been 4 attempts since Aug 2020 when GOLD(XAUUSD.FX) attempted to break above 2085.
Since August 2020, XAU/USD(XAUUSD.FX has made four attempts to break above the 2085 level. However, each time, it encountered resistance and failed to sustain the breakthrough. Last week, a significant milestone was achieved: the price closed the week above 2085. This development signals a shift in investor sentiment.
Why is this a milestone? Because it indicates that investors are now willing to hold their gold positions over the weekend. This decision reflects their intention to bear the risk associated with weekend market fluctuations. In the past, despite multiple attempts, gold prices consistently faced rejection at the 2085 resistance level, resulting in long tails on the charts.
The recent successful close above 2085 suggests growing confidence in gold’s upward potential. Investors are demonstrating their commitment to weathering the weekend volatility, which bodes well for further price appreciation. 📈🌟
Current Gold Pattern
Indeed, it is resembling a cup and handle continuation pattern.
What is a cup and handle pattern?
The cup and handle pattern is a bullish chart formation.
Cup Formation:
- Imagine a U-shaped cup on the price chart.
- It shows a pause in an uptrend.
- The cup’s depth should be small (about 1/3 of the previous rise).
Handle Formation:
- After the cup, there’s a pullback called the handle.
- The handle is like a mini consolidation.
- It shouldn’t retrace too much (ideally 1/3 of the cup’s advance).
Breakout:
- When the price breaks above the handle, it’s a bullish signal.
- Investors are confident and willing to hold over the weekend.
- The projected move is based on the cup’s depth.
- In short, the cup and handle pattern suggests a continuation of the uptrend. 📈🏆
The current projected target of the cup and handle pattern if there is a breakout:
- Near term: $2250
- Long term: $2600
What can investors consider for investment:
I did a video here on how investors can invest in Gold without converting to USD or using their CPF or SRS. GLD US(O87.SGis one of them.
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