Strong chance XAUUSD has broken out of this bullish pattern

XAUUSD printed a 3 week bullish continuation pattern

This is how it looks like. If you don’t see it, here it is again.

XAUUSD daily chart

XAUUSD daily chart

XAUUSD weekly chart

XAUUSD weekly chart

Because it is triangular, it is also called a bullish pennant but importantly whatever the name is, traders should note that

  1. it is expected to be bullish continuation
  2. to look out for break of resistance level/line
  3. that 3-week consolidation is fuel for the next leg up

 

3 reasons that  support XAUUSD has broken out

Reason #1

XAUUSD broke 3 weeks consolidation

XAUUSD broke 3 weeks consolidation

Based on trend line study, the 3-week consolidation is broken. Although XAUUSD is now resisted at next level which is previous high, we can see that consolidation zone to become support.

 

Reason #2

Ok this this is not a good enough reason yet. Today is Friday so there is a good chance to see a week close but really I jumped the gun. However unless higher powers slam XAUUSD below 1237, this bullish condition is likely to meet.

XAUUSD near to closing above 52-week high

XAUUSD near to closing above 52-week high

 

Reason #3

Banking on Reason #2 but also pending closing price action tonight. Do note that based on Reason #2 also for weekly chart, 1237 could become support if a throwback shows up.

XAUUSD to break channel in place since 2013

XAUUSD to break channel in place since 2013

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Soh Tiong Hum is Director of TerraSeeds Market Technician Pte Ltd. TerraSeeds is a trading educator in Singapore since 2005.   Soh's Twitter account @sohtionghum was ranked #23 out of The Top 70 Twitter Accounts To Follow In 2015 by MahiFX.   Disclaimer notice: "I do not have a financial advisor's license. I am not qualified by any regulator to give financial advice. I do not know you the reader. Your investment means and motive may be different from me. My posts here are based on observations and meant for education. I am not responsible for for any consequence from your actions."
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