Gold prices should be cautious of forming a large double top pattern
"Gold Price May Form a Large Double Top Pattern" 28/8/2025 10:03 Completed
Gold prices maintained a strong trend yesterday, finding support at the $3,373 level, which was in line with the second support level I predicted yesterday. From the hourly chart, it can be seen that spot gold prices broke through the $3,385 level in the Asian session and attempted to break through this level again in the early European session, but failed. However, the climax was yet to come. Gold prices surged in the midday New York session, reaching a high of nearly $3,399.
The fate of Powell has been decided.
Tonight, the United States will release the revised second-quarter GDP figure, with an expected annualized quarterly growth rate of 3%, the same as the initial estimate. Additionally, the US will also release the revised second-quarter core PCE price index, with an expected quarterly increase of 2.5%, a slower pace than the 3.5% increase in the first quarter. Although both are lagging indicators, they can definitely serve as an excuse for market speculation. On the other hand, US Treasury Secretary Mnuchin stated that the 11 candidates for the Federal Reserve chair position are all strong contenders, and they will be interviewed after Labor Day and the final list will be submitted to Trump. This is equivalent to telling Powell that we will not renew your contract when your term expires in May next year! It can be said that the fate of Powell has already been decided, and the market can use this as a reason to push up gold prices at any time.
Gold prices rose further to $3,399 in the early Asian session today before retreating. From the hourly chart, the morning high has penetrated the dense zone on August 8th, but failed to break through the $3,400 mark. Be cautious of a potential large double top formation. If it falls below the short-term TD ascending track at $3,377, the measured decline target is at the $3,355 level, which coincides with the 50% retracement of the largest increase since August 20th and can be regarded as an important support within the day. However, the adjustment is too small. If gold prices continue to fall, it is not ruled out that it will test the neckline of the large double top, that is, the low of August 20th at $3,311.
$3,400 is like a curse.
A spellbinding phenomenon remains unbroken to this day. Since April 21st, whenever the gold price closed above $3,400 on a daily chart, it would reverse the next day and fall below $3,400 to close, followed by a deeper correction. This time, if the gold price crosses the $3,400 mark without breaking it, it may signal the start of another significant decline and should be watched closely. From another perspective, if the gold price closes above $3,400 for two consecutive days, this "curse" will be broken, and it might be a precursor to a new high in gold prices!
The above content is for reference only and does not constitute investment advice.
MTF Special Analyst Zheng Guangfu
Previous Article Next Article