Gold price correction to the apex of triangle

Despite the solid long-term and medium-term bullish trends in the gold market, recent developments have initiated a short-term price correction. After achieving sustained growth, the price of gold has topped and begun consolidating to lower levels. This movement aligns with our forecasts that leveraged short-term cycles, predicting a market peak around April 9th. Our analysis confirmed the peak on April 12th, which fell within the 72-hour deviation window for short-term cycles. This expected correction is attributed to the highly overbought conditions depicted on daily and weekly charts, signaling an impending price correction. Gold price correction is now approaching the apex of triangle which indicates a significant breakout.

The corrective phase has steered gold prices toward the initial target of $2,285. This is an important figure previously discussed in our exclusive Sunday Weekly Letter. Here, we had indicated to premium members that $2,285 would serve as the first level of support. However, the scenario has grown increasingly complex with the onset of seasonal pullbacks. These pullbacks have resulted in choppy, overlapping price patterns characterized by pronounced volatility. Amid these fluctuations, the gold price has become trapped within a triangular formation as shown in the chart below.

Gold price correction and apex of triangle

This triangle on the chart presents the ongoing struggle in the gold market as it attempts to find a new equilibrium. Significant market events such as the Federal Open Market Committee (FOMC) meetings and the Non-Farm Payroll (NFP) announcements have passed. Yet, the gold prices have remained confined within this triangle. As we approach the apex of this formation, the market stands on the cusp of a potential breakout. This impending breakout signals the next substantial move in the market. However, traders may exercise caution due to the potential of a fake breakout, possibly due to the Labor Day on May 1st, which typically sees reduced market activity, which may lead to fake price movements, or ‘fake breakouts,’ as the markets resume full operations.

Conclusion

In conclusion, while the immediate-term trend shows some challenges, the long-term trend in the gold market remains strongly bullish. This recent price correction is a compelling buying opportunity for medium-term traders.