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The price of Gold surged during the early trading session in Europe on Thursday, reaching US$ 2,779 per troy ounce. An analysis of the 1-hour chart indicates that Gold has broken out of a Symmetrical Triangle pattern, signaling the potential for further upward movement.
The width of this Symmetrical Triangle is approximately 410 pips, suggesting that Gold could rise by this margin following a breakout above its upper boundary.
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However, the Stochastic indicator is displaying a bearish divergence which may trigger a corrective move.
In the 15-minute chart, the Stochastic is also in the overbought zone, indicating potential short-term declines. Nonetheless, such a dip could present a buying opportunity with an improved risk-reward ratio. As long as prices remain above US$ 2,765, there remains a chance for Gold to rise to US$ 2,790 per troy ounce, which represents the highest historical level reached on October 31st.
Technical reference: Buy while above US$ 2,765
Potential Take Profit 1: US$ 2,790
Potential Take Profit 2: US$ 2,800
Potential Stop Loss 1: US$ 2,765
Potential Stop Loss 2: US$ 2,755