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- Gold price looks weak here as it broke out of a rising channel. The market may have also formed a head and shoulders pattern.
Gold price had a strong month. It bounced from a double top formation at the start of April and did not look back ever since.
On its way to the upside, it formed a rising channel, while the bullish conditions persisted throughout the month. However, it recently broke out of the channel, and it also broke the series of higher lows. Hence, bulls should be cautious of a reversal.
Commodities had a tremendous start to the year. Oil, corn, lumber – they all traded with a bid tone. Not gold.
With the exception of April, gold was in a steep decline since it posted an all-time high last August. Hence, it may very well be that the current bounce seen in April is nothing but a correction in an otherwise bearish market.
Gold Price Technical Analysis
From a technical perspective, we may also talk about a head and shoulders formation. The market broke below the neckline, it is now retesting it, and prepares to go for the measured move.
Bears may want for the market to make a new lower low before going short for a move below the previous double top. As for the invalidation, the stop loss order must be set at the lower end of the rising channel.
Gold Price Forecast
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