FX.co ★ Gold: fresh bullish pattern, 1,716 as resistance

The price of Gold rallied after reaching the 1,707 level and now it is trading at 1,712 at the time of writing. The price action developed a potential upside continuation pattern. The bias is bullish, so further growth is in cards.

XAU/USD is bullish as the Dollar Index was in a corrective phase. DXY dropped after the US Unemployment Rate jumped from 3.5% to 3.7% above the 3.6% expected and because the FED is expected to deliver only a 50 bps hike in December. Still, the US data could be decisive tomorrow. The CPI is expected to report a 0.6% growth in October, whale Core CPI could register a 0.5% growth in the last month. Higher-than-expected inflation could boost the greenback and could push XAU/USD down.

XAU/USD Flag Formation!

As you can see on the H1 chart, XAU/USD retreated a little after reaching 1,716 and it was almost to reach the R1 (1,702) downside obstacle. The bias remains bullish as long as it stays above the uptrend line.

Technically, the yellow metal developed a flag pattern that could announce an upside continuation. After its strong rally, a minor retreat was natural.

XAU/USD Forecast!

A new higher high, jumping and closing above 1,716 activates further growth and brings long opportunities with a first upside target at the R2 (1,724).