Gold Price Forecast: Descending broadening channel breakout on 4H

Gold could rise to $1,310 in the next 24 hours, having generated a strong bullish cue in late NY/early Asian session. 

The yellow metal is currently trading at $1,304 per Oz - up 1.87 percent from the recent low of $1,280. 

Prices crossed $1,300 in the overnight trade confirming an upside break of the bearish broadening channel on the 4-hour chart. The bullish breakout has strengthened the case for a rally to $1,310, as called by the bull flag breakout confirmed yesterday. 

Still, the bulls need to be cautious as the 10-year treasury yield is on the rise, currently trading at 2.61 percent, up two basis points from the low of 2.59 percent hit yesterday. 

The uptick in the 10-year yield may put a bid under the US dollar, making it difficult for the yellow metal to capitalize on the falling channel breakout. 

That said, the bullish case would weaken only if prices fall back below $1,300 (failed breakout). That will likely happen if the US February durable goods orders data, scheduled for release at 12:30, blows past expectations, sending the 10-year treasury yield to yesterday's high of 2.67 percent. 

It is worth noting that a failed breakout is as good as a bearish reversal pattern. Hence, a drop below $1,300 could invite strong selling pressure. 

Further, a bearish crossover of the 100-candle and 200-candle moving averages (MAs) is seen on the 4-hour chart. Both averages are currently located at $1,310, so that level could put brakes on the corrective rally. A convincing break above $1,310 could be seen if the US data misses expectations by a big margin, pushing the 10-year yield below key support of 2.59 percent. That will likely lead to broad-based USD weakness. 

4-hour chart