Third consecutive bullish month for Gold

The end of the month brings us a correction on Gold, which really had an amazing January. If the month closed now, so before the opening of the American session, Gold would record a 5.5% rise for January, and that would and probably will be the third bullish month in a row. As we said, last few days we do have a correction on this instrument but is it serious and can start a new bearish trend or is it a typical taking profit action from the buyers?

All signs on the chart tell us that this is more of a second option. In November and December, the price was moving higher inside of the channel-up pattern. At the beginning of January, the price showed enormous power and broke the upper line of this pattern accelerating the rise. Why is it important? Because the price is still above this channel up formation! Even if the comeback inside would not be anything serious, the bulls would be still winning.

Key support for the buyers seems the 1870 USD/oz, so the highs from June and in the current case, also the 23.6% Fibonacci. As long as we stay above that line, as well as the lower line of the channel-up pattern, we are safe. Only the price breaking those two would bring us the sell signal but currently, chances for that are rather limited.

Source: https://www.axiory.com/analytics/technical-analysis/third-consecutive-bullish-month-for-gold