Sep 4, 2012

Gold in new bull trend

After trading in a triangle consolidation for the last year gold finaly broke the figure in friday. Recent speculations fueled by possibility for another quantitative easing has kept price of gold rising for the last month. If there is actual confirmation for another stimulus shot than there is high possibility for strong gold rally similar to 2009-2011 one.

Wide spread technical pattern confirms that successful breakout of the triangle leads to move with height just as triangle height. The implication from technical point of view is that the next target could be $2000. The target level is formed as projection of the triangle height is added to the breakout level. Thus to break level of $1662 we could see some $461 gain.

The risk for mentioned target is disappointment of eventual QE3 postpone or even rejection, strong dollar and low inflation economic environment.

Next gold target
Next gold target

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