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Gold Moving Off Nicely from Triangle Support

Gold price continues to remain resilient after testing a triangle support at 1271.55, as we can see in the daily chart. Note that this 1270-1275 area was also reinforced by common lows in April and May. Price has now returned into the cluster of 200-, 100-, and 50-day Simple Moving Averages (SMAs). The RSI avoided 30, showing lack of bearish momentum. Gold is now back to the neutral mode, shifting away from a bearish mode that lasted almost 2 months.

(Gold Daily Chart 8/28)

We can see this bullish development in the short-term when we look at the 1H chart. Last week traders formed a consolidation range, which turned out to be a price bottom after traders started this week buying up gold. Then after a pullback, traders respected last week's range as support and price bottom, continuing to develop a bullish trend in the short-term.

Price broke above the 200-, 100-, and 50-hour SMAs. The RSI tagged 80 and stayed above 40, showing bullish momentum development.

The next challenge is the 1300 handle. If price cannot push above 1300, there might still be bearish bias within the sideways mode.

If gold price does push above 1300, it will expose the triangle resistance, which could coincide with the 1320 August high. A break above the triangle then opens up a bullish outlook in the medium-term. But for now, we should limit our bullish or bearish outlook until the triangle is broken.

(Gold 1H Chart 8/28)