The resistance is identified as the 150 percent projection level of an upward wave C from $1,195.90. Following its surge above $1,311, the metal is highly likely to climb to $1,331.
On a long-term daily chart, gold broke a key barrier at $1,305, the 7 percent projection level of a presumed wave (C) from $1,366.07. The break opened the way towards $1,366.07.
The wave (C) turned out to be a wave d, the fourth wave of a five-wave cycle from the Dec. 3, 2015 low of $1,045.85. This cycle has been shaped into a rising wedge, which is supposed to be a bearish continuation pattern. As a result, it might not the time for bulls to cheer the dawn of a long-term uptrend. Chances are the current wave e may peak around $1,366.
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** Wang Tao is a Reuters market analyst for commodities and energy technicals. The views expressed are his own.
No information in this analysis should be considered as being business, financial or legal advice. Each reader should consult his or her own professional or other advisers for business, financial or legal advice regarding the products mentioned in the analyses.