Gold continuation pattern gives upside target in excess of $2,000
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XAUUSD Weekly Analysis
- Gold has charted a series of higher troughs (HT), followed by higher peaks (HP).
- This puts the precious metal into an uptrend on a primary trend basis.
- From April to the beginning of July, XAUUSD charted a falling wedge. This is a bullish continuation pattern.
- The pattern completed with price breaking out to the upside last week (blue arow).
- The breakout corresponded with the weekly RSI moving above 50 (blue rectangle). This is the bullish side of the oscillator. The longer it maintains on this side, the greater the likelihood of further price appreciation.
Falling Wedge Measured Move
- When a wedge is a continuation pattern, as in this case, the range of the impulse into the wedge can be extended out in the direction of the breakout (green vertical dashed lines).
- This gives a measured move to $2,200.
- Measured moves or targets are academic in nature. They may or may not be met.
- However, it does highlight the underlying bullishness inherent in the precious metal.
Comment
The breakout from the falling wedge pattern coincides with a moderation in inflation in the US. Previous Federal Reserve rate hikes are still working themselves through the transmission mechanism. A possible scenario is that July is the last rate hike of the Federal Reserve's current tightening cycle. If so, this may provide a tailwind, and the precious metal could end 2023 on a strong note, heading towards the measured move's target.
Russell Shor
Senior Market Strategist
Russell Shor is a Senior Market Strategist at FXCM, having been promoted to the role in 2025 in recognition of his depth of insight and consistent delivery of high-impact market analysis. He originally joined FXCM in October 2017 as a Senior Market Specialist.
Russell holds an Honours Degree in Economics from the University of South Africa, is a certified FMVA®, and a full member of the Society of Technical Analysts (UK). With over 20 years of experience in financial markets, his work is renowned for its clarity, precision, and strategic value across asset classes.
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