The 4hr tf chart of XAUUSD (Gold) shows that price has been meandering ever since Gold made a high of ~$1,365.95 on January 25, 2018.
The chart pattern that best describes the meandering price action of XAUUSD (Gold) since January 25, 2018 is a descending triangle. This chart pattern ideally has bearish implications, but not all the time. This implies that a breakout upwards for XAUUSD is also possible.
In either case, a downward breakout outside this descending triangle can see price of XAUUSD reach ~$1,247.95. This is calculated based on a downward projection of the width of the chart pattern and subtracting it from the breakout point (breakout in this case is ~$1306.95)
Width of the descending triangle is shown by the light blue line and is calculated by taking the difference between the high and low of price (i.e. $1,365.95 - $1,306.95 = $59)
In the case of an upside breakout, the width of the descending triangle ($59) can be added to the breakout point above the triangle. In this analysis, I used the breakout price of ~$1357.73.
Projection of termination of XAUUSD for a breakout above the triangle therefore = $59 + $1357.73 = $1,416.73
P.S. Analysis was carried out using FXCM’s data so projections may vary slightly depending on your broker.
The chart pattern that best describes the meandering price action of XAUUSD (Gold) since January 25, 2018 is a descending triangle. This chart pattern ideally has bearish implications, but not all the time. This implies that a breakout upwards for XAUUSD is also possible.
In either case, a downward breakout outside this descending triangle can see price of XAUUSD reach ~$1,247.95. This is calculated based on a downward projection of the width of the chart pattern and subtracting it from the breakout point (breakout in this case is ~$1306.95)
Width of the descending triangle is shown by the light blue line and is calculated by taking the difference between the high and low of price (i.e. $1,365.95 - $1,306.95 = $59)
In the case of an upside breakout, the width of the descending triangle ($59) can be added to the breakout point above the triangle. In this analysis, I used the breakout price of ~$1357.73.
Projection of termination of XAUUSD for a breakout above the triangle therefore = $59 + $1357.73 = $1,416.73
P.S. Analysis was carried out using FXCM’s data so projections may vary slightly depending on your broker.