It's the weekend so the markets are closed and while I was having a fresh look at the price action in Gold this week I thought it was worth pointing something out. We are right on the precipice of another key decision point. The Gold price has hit Resistance on my Bullish Flag Channel and is threatening to break through.
I first highlighted this channel just 12 days ago with my post Gold Consolidates Recent Gains and since then Gold went on to bounce solidly (and almost perfectly) off the Support Line on May 15. I particularly like the look of the Dragonfly Doji on the chart there. Yes, it's only a 4 hour candle, but it's a good looking reversal signal.
Now Gold has come back up to test the Resistance Line at $3357. It got to that level on Friday afternoon and has kind of paused there rather than reflexively bouncing. That might suggest it's a decent chance of going through. Either way it's clearly a decision point and I am predicting a decent move on Monday. We might even see it over here in Australia before the US markets open if there is any significant development over the weekend.
If the price goes through this level then it's GAME ON once again and I'll be looking for a new price target higher. If it comes down then the Bullish Flag Channel will hold for a little bit longer. I will wait and see, but right at this moment I'd rather be long than short.
