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Gold prices experienced a significant boost in early trading this week, solidifying their position above the key psychological resistance level of $2400 per ounce. Previous technical analysis highlighted the potential for a direct recovery towards $2330 once prices held above $2295, a prediction validated by gold’s recent peak of $2358.
Technical Indicators Favor Further Gains
Current technical analysis suggests the upward trajectory is likely to continue. This optimism stems from intraday trading remaining above the $2340 resistance level (representing the 23.60% Fibonacci retracement on the 240-minute chart) and the Stochastic indicator’s attempts to shake off intraday negativity.
Upside Targets and Potential Extension of Gains
The most probable scenario for today’s trading is a continued rise, targeting $2360. If prices consolidate above $2365, the upward trend could strengthen and accelerate, potentially leading to subsequent targets of $2372, $2387, and even $2410.
Downside Risks and Support Levels
However, traders should be aware that a sustained drop below $2340, and more importantly $2335, could reintroduce downward pressure, with an initial target of $2320.
Cautionary Notes:
- US Economic Data: The release of the US Consumer Confidence Index later today may trigger significant price volatility.
- Geopolitical Tensions: Ongoing geopolitical uncertainties could also lead to sharp price fluctuations.
Disclaimer: Trading in CFDs involves risks, and all scenarios are possible. This analysis is not investment advice but rather an interpretation of the current technical landscape for gold.
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