Gold Reactivation, i.e. a change in the balance of power on the XAU / USD market

On Tuesday gold quotation They rose to 1712,53 dollars from 1699,73 yesterday at the end of the day and against 1660,93 at the close on Friday. Currently, the prices of this metal are at the highest since September 13, while in the previous week they were at the April 2020 levels.

XAU / USD - technical situation

In a week, gold prices recovered from $ 1614,83, back above the $ 1676,83-1682,20 resistance zone from the lows in March and August 2021 and July this year, and are now heading towards the upper limit half-year downward channel. 

XAU / USD daily chart. Source: Tickmill

Upper bound of the semi-annual downturn channel on the price chart gold, it is currently at $ 1718, creating the closest supply barrier. Quite a strong barrier, because it has a six-month history. Even if the demand side fails to overcome it, there is still a mighty twist and a shift in the balance of power on the daily gold chart. Mostly because gold quotes returned above the neckline drawn from the 3-year double-top formation. This means that the risk of falling towards $ 1300 has been significantly reduced. 

Moreover, negating a supply pattern usually produces a demand signal. Hence, the chances of a breakout of gold from the above-mentioned downward channel have increased slightly, however. If it actually happened, it would be at the turn of October and November, the gold price could test the region of $ 1800. Therefore, it is worth observing what will happen on the gold market in the coming days.