Gold Is Moving Within A Trend Channel

For the past twelve hours Gold has been moving to the upside in a trend channel with a height of 53 pips at its base and it has formed four points of contact so far. That gives us the opportunity to trade the breakout of that channel, regardless of its direction.

At a first glance this channel looks like a trend-continuation flag pattern and that would be confirmed if the breakout is to the upside. Should that happen we could expect a move to the upside towards 1180.

If Gold breaks out to the downside I think the closest target will be at 1150, and a more long-term target will be at 1110.

If we judge by the bars that are forming above the support at 1155 we could conclude that Gold will move to the resistance trendline again. Still, while Gold is moving within the channel it should be traded with caution.