Gold Rallied In A Perfectly Formed Channel

Gold reached the diagonal support at 1260.50 (in brown) for a second time and renewed its rally. At the same time it became possible to draw another diagonal trend line alongside the trend channel in which Gold has developed since 15th December 2016 (in red) and which essentially widened the trend channel.

I have marked the movements of the precious metal in the trend channel in blue. Logically speaking, I think that there will be a rally to the resistance trend line (in red), which will finish the cycle of three threes of waves within the channel. My main expectation is a rally to 1420.

In the alternate scenario it will reach the trend line marked by a red dotted line and ten fall to the brown trend line.

Of course, these are just the two main scenarios. There are other possibilities depending on the direction the market will pick.