In today’s gold price forecast, I decided to share with you my insights from today’s Quick Gold Alert. Have a nice read!
January 31, 2025
Breakout, gap and bulls’ targets to watch.
Technical Picture of Gold
On Wednesday, you could read the following:
(…) gold futures are still trading above the lower border of the green supportive gap ((2794.60-2797.99), which started Wednesday and the previously broken lower border of the blue rising wedge (currently at around $2,790.65).
What does it mean for the futures?
In my opinion, as long as there is no successful breakdown under these important supports another attack on $2,800 (or even the next above-mentioned upside targets) can’t be ruled out.
From today’s point of view, we see that the situation developed in line with quoted assumptions, and gold futures moved to the north, hitting fresh all-time peaks.
As you see on the daily chart, although gold bears pushed the price a bit lower on Wednesday, the next session started with another green supportive gap ($2,793.50-$2,796.20), which lured buyers to the trading floor and encouraged them to fight.
Thanks to their determination, gold futures broke above the upper line of the blue consolidation ($2,760.20-$2,805.50), neutralized the dark cloud cover candlestick formation, and opened the way to higher prices.
Taking into account the height of the mentioned formation, gold bulls also activated a pro-growth scenario, which suggested that we could see a move to around $2,850.8. When we take a closer look at the chart, we see that they materialized and hit a fresh all-time high of $2,853.20 during yesterday’s session.
Thanks to this move, the price increased to the upper line of the purple rising trend channel and pulled back slightly before the end of the day.
Did it discourage the buyers from further action?
Not really.
Earlier today, we noticed one more upswing, and another fresh peak of $2,859.45 appeared on the chart.
How high could the futures go in the coming day(s)?
When we take a closer look at the chart, we see that not far from the current level, there is the upper border of the medium-term orange rising trend channel (at around $2,868.88), which serves as the nearest resistance at the moment.
Having said that, let’s check what we can infer from the 4-hour chart.
From this perspective, we see that although gold futures pulled back slightly, it seems that we’ll see a test of the nearest resistances in the very near future.
What do I mean by that?
If the buyers extend gains, we’ll see a re-test of the strength of the upper line of the green rising trend channel (at around $2,864.80).
If it is broken, the way to the next resistance zone (at around $2,868.17-$2,877.98) based on the 161.8% Fibonacci extension (based on the Dec. 12, 2024 – Dec.19, 2024 downward move) and the 127.2% Fibonacci extension (based on the entire Oct. 2024- mid. Nov. 2024 downward move) will be open.
Nevertheless, please keep in mind that the current position of the 4-hour indicators suggests that the space for increases may be limited in the very short term, which can translate into a pullback and correction of the recent increases at the beginning of the upcoming week.
Summing up, gold bulls successfully broke above the barrier of $2,800 and the upper line of the blue consolidation (marked on the daily chart), which opened the way to higher levels and suggests that we’ll see a test of the nearest resistances in the very near future.
Have a profitable day and a wonderful weekend.
Anna Radomska