Gold Price Targets: XAU/USD Surges 4%- Can the Rally be Sustained?

• Gold price breakout approaching multi-year uptrend resistance– constructive above 1392
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Gold prices have now rallied nearly 19% off the yearly lows in the past three months and nearly 4% this week alone with the precious metal poised to mark the highest weekly close since April of 2013. Gold has seen just two down weeks in the past eleven and while the broader focus remains higher, the advance is now reaching a critical multi-year resistance slope- we’re looking for a reaction up there. These are the updated targets and invalidation levels that matter on the XAU/USD weekly price chart heading into the close of the month. Review my latestWeekly Strategy Webinar for an in-depth breakdown of this gold price setup and more.

GOLD PRICE CHART - XAU/USD WEEKLY

Notes: In my last XAU/USD PriceOutlook we noted that, “Gold prices are in breakout mode – the advance is testing near-term up-trend resistance and we’re looking for a reaction with the focus higher while above 1451.” The advance registered a high at 1510 on the back of a spectacular advance that saw prices post the largest single-week rally / range since mid-June (that instance marked a breach of the yearly opening-range highs). Note that weekly RSI is now approaching the momentum highs registered just before the 2011 record highs

Initial weekly resistance targets stand with the 2015 parallel (red) around ~1515 with more significant confluence region eyed at pitchfork resistance / December 2011 & 2012 lows at 1522/26- look for a larger reaction there IF reached. Key support steady at 1451backed by 1433 with broader bullish invalidation now raised to the median-line / 2014 high at 1391.

Bottom line:The gold breakout is getting deep with the advance now maturing towards long-term uptrend slope resistance targets. From at trading standpoint, look to reduce long-exposure / raise protective stops on a stretch towards trend resistance around 1522/26- a region of interest for possible near-term exhaustion. Ultimately, we’ll be looking for a larger pullback to offer more favorable entries with the broader focus higher while above the median-line. Review my latest Gold Price Outlook for a closer look at the near-term XAU/USD technical trading levels.

GOLD TRADER SENTIMENT - XAU/USD PRICE CHART