Gold has been quite volatile in recent months. However, this October, the precious metal seems to be trading range-bound amid various factors affecting the global economy. The yellow metal built on the previous day’s modest bounce from a 2-week-old ascending trend-line support. It climbed to over 1-week tops on October 21, 2020.
Now, the bulls might be looking to build on the new-found momentum beyond a descending trend-line resistance, extending from the highs that were touched on August 18. This combination of trend-lines comprised the formation of a symmetrical triangle on the short-term charts. That points to indecision over the commodity’s near-term trajectory.
Nevertheless, the fact that gold has managed to break through the triangle resistance, the bias now appears tilted favoring the bullish traders. In the meantime, technical indicators available on the daily chart have started moving into positive territory and add some credence to the constructive outlook.
Thus, a follow-up move back towards the monthly swing highs, near the $1933 zone, now appears like a distinct possibility. This momentum may further get extended towards the $1961-63 supply level.
On the other hand, the triangle resistance breakpoint located around the $1918-17 area now appears to act as the nearest support and it is closely followed by the $1908 area. Any further slide may now be perceived to be a great opportunity to initiate fresh bullish positions. That, in turn, will help limit the downside near the $1900 round-figure zone.