Gold Price Analysis: Bull flag or rising wedge breakdown?
|- Gold's 4-hour chart shows a rising wedge and a bull flag pattern.
- The S&P 500 futures are flashing green and signaling a risk-on environment.
- The yellow metal could witness a rising wedge breakdown.
Gold's 4-hour chart is reporting conflicting price patterns.
To start with, the pullback from the April 14 high of $1,747 to $1,700 (Friday's Asian session low) has taken the shape of a bull flag, a pause which usually accelerates the preceding bullish move.
A move above the top end of the flag at $1,738 would confirm the breakout and open the doors for a convincing move above $1,750.
Further, the metal is also teasing a rising wedge breakdown, a bearish reversal pattern. The breakdown would be confirmed if the current 4-hour candle closes under $1,717. That would imply an end of the rally from $1,455 and would shift the focus to the immediate support at $1,642 (higher low created on April 8).
With the S&P 500 futures reporting over 3 percent gains at press time, a rising wedge breakdown looks likely. Risk assets are better bid in Asia, possibly on STAT news report that Gilead Sciences' experimental drug remdesivir is seeing rapid recoveries in fever and respiratory symptoms associated with coronavirus.
The yellow metal is trading at $1,713 per ounce at press time, representing a 0.26% drop on the day.
4-hour chart
Trend: Bearish
Technical levels
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