We see the triangle break targeting a move to $2060 – we see a pronounced cup and handle (best seen on the weekly), which now complete suggests an increased probability we see new all-time highs.
Price is testing the 1900 round number and sits up 5.6% for the month of February – the best month since May 2021 – what’s more, it’s taken place when US real rates have gained 23bp over the month – historically this would have been a huge headwind for the yellow metal.
(Source: Tradingview - Past performance is not indicative of future performance.)
Staying on the technical vibe, we see price riding the upper Bollinger Band as the bands widen, and we have the various oscillators telling us what we can see clearly and that is XAUUSD is positively trending. The obvious upside level now that we’ve taken out the 16 Nov swing of 1877 is 1916 – a break of 1916 and 1923 (the 61.8% fibo of the ATH to March 2021) and we can talk about 2050/60.
We are seeing trend-follower capital into the Gold market now, but positioning is still light and there is far more capital still to be deployed if the move really starts to get away. Known ETF holdings of Gold have moved up 2% moving this year after falling 12% since October 2020.
As always in trading, it pays to keep an open mind and you can trade the possibilities with Pepperstone.
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