This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
Bullish breakout for gold
Gold is in the process of breaking out of a symmetrical triangle formation, which has been in play since early February. The key to a confirmation of this would be a closed candle (4-hour would give better confidence than 1-hour) above the triangle top of $1284.
Should that occur, we are likely to see a strong week ahead for gold. For now, we have clearly broken through $1271 resistance and subsequently found support, posting a bullish hammer candle this morning. With that in mind, further upside seems likely which looks onward towards $1280, $1284 and $1300.
A closed hourly candle below $1271 would bring a more neutral view given that we are heavily extended to the upside currently.