FX.co ★ Gold wave analysis for February 23, 2016

Gold price continues to hold above $1,200. The price is moving mainly sideways. There is a triangle pattern being formed in a possible wave 4 of a lower degree. This implies that more upside should be expected in gold and $1,300 to be reached over the coming weeks. This scenario will be canceled if the price breaks below $1,112.

Blue lines - triangle pattern

Gold price is forming a triangle pattern as a wave (4). Wave (5) upwards to complete wave 3 is expected. Eventually, the price will most probably break out above $1,300 if this scenario is correct. The price is still holding above the Ichimoku cloud and the decline does not look impulsive as the price has already overlapped a low of $1,220 reached on February 19.

On a weekly basis, a trend is bullish as long as the price is above both the weekly Kumo (cloud) and the kijun- and tenkan-sen indicators. The back test of the broken cloud resistance and the downward sloping wedge was successful so far favoring the bullish continuation of the upward move that started from $1,050.