Gold hit another record high Tuesday morning as investors turn to the traditional safe haven amid a weakening in the U.S. dollar and concerns over a potential government shutdown.

After breaking out from a four-month consolidation period in early September, the price of gold has continued to trend strongly higher in recent weeks.

Bars pattern analysis forecasts a potential bullish target of around $4,365. Investors should also watch key support levels on gold's chart around $3,450, $3,120 and $2,790.

Gold ( XAUUSD ) remains in focus after setting a fresh record high Tuesday, as the precious metal is on track for its seventh consecutive week of gains.

Recent buying in the commodity has been fueled by a softer U.S. dollar ahead of an expected interest rate cut by the Federal Reserve next month and mounting concerns over a possible government shutdown . A weaker dollar lifts demand for dollar-priced bullion from foreign buyers, while safe-haven demand has increased amid the risk of a shutdown starting Wednesday and unresolved geopolitical tensions in the Middle East and Europe.

The price of gold has soared 45% since the start of the year and 10% over the past month, far outpacing the gains of major stock indexes. Spot gold was up slightly at around $3,850 an ounce in recent trading.

Below, we analyze the technicals on gold’s weekly chart and identify key price levels to watch out for amid the precious metal’s bull run.

After breaking out from a four-month consolidation period in early September, the price of gold has continued to trend strongly higher in recent weeks.

While the relative strength index confirms the bullish momentum, the indicator also nears a stretched reading that has preceded several pauses in the precious mental’s uptrend over the past 18 months.

Let’s apply technical analysis to forecast where the commodity’s bullish price move may be headed next and also point out support levels worth watching during future pullbacks.

To forecast where gold’s uptrend may be headed in coming weeks bulls remain in control of the price action , investors can use bars pattern analysis, a technique that studies prior trends to project future directional movements.

When applying the analysis, we take the precious metal’s strong trending move from early January to late April and overlay it from the start of the current uptrend. This forecasts a target of around $4,365, implying about 13% upside from Tuesday’s trading levels.

We selected the earlier move because it started with eight consecutive green weekly bars, closely mimicking gold’s latest advance, which is on track to record its seventh consecutive higher weekly close.

The first support level to watch sits around $3,450. Retracements to this area would likely attract buying interest near the upper range of the recent four-month consolidation period.

Bulls ’ failure to defend this key level could see the commodity’s price retreat to $3,120. This location on the chart may provide support near the May low, which currently sits just above the upward sloping 50-week moving average.

Finally, a more-significant decline opens the door for a retest of lower support around $2,790. Investors could look for longer-term buy-and-hold opportunities in this area near last year’s notable October peak.

The comments, opinions, and analyses expressed on Investopedia are for informational purposes only. Read our warranty and liability disclaimer for more info.

As of the date this article was written, the author does not own any of the above securities.

Read the original article on Investopedia

Gold hit another record high Tuesday morning as investors turn to the traditional safe haven amid a weakening in the U.S. dollar and concerns over a potential government shutdown.

After breaking out from a four-month consolidation period in early September, the price of gold has continued to trend strongly higher in recent weeks.

Bars pattern analysis forecasts a potential bullish target of around $4,365. Investors should also watch key support levels on gold's chart around $3,450, $3,120 and $2,790.

Gold ( XAUUSD ) remains in focus after setting a fresh record high Tuesday, as the precious metal is on track for its seventh consecutive week of gains.

Recent buying in the commodity has been fueled by a softer U.S. dollar ahead of an expected interest rate cut by the Federal Reserve next month and mounting concerns over a possible government shutdown . A weaker dollar lifts demand for dollar-priced bullion from foreign buyers, while safe-haven demand has increased amid the risk of a shutdown starting Wednesday and unresolved geopolitical tensions in the Middle East and Europe.

The price of gold has soared 45% since the start of the year and 10% over the past month, far outpacing the gains of major stock indexes. Spot gold was up slightly at around $3,850 an ounce in recent trading.

Below, we analyze the technicals on gold’s weekly chart and identify key price levels to watch out for amid the precious metal’s bull run.

After breaking out from a four-month consolidation period in early September, the price of gold has continued to trend strongly higher in recent weeks.

While the relative strength index confirms the bullish momentum, the indicator also nears a stretched reading that has preceded several pauses in the precious mental’s uptrend over the past 18 months.

Let’s apply technical analysis to forecast where the commodity’s bullish price move may be headed next and also point out support levels worth watching during future pullbacks.

To forecast where gold’s uptrend may be headed in coming weeks bulls remain in control of the price action , investors can use bars pattern analysis, a technique that studies prior trends to project future directional movements.

When applying the analysis, we take the precious metal’s strong trending move from early January to late April and overlay it from the start of the current uptrend. This forecasts a target of around $4,365, implying about 13% upside from Tuesday’s trading levels.

We selected the earlier move because it started with eight consecutive green weekly bars, closely mimicking gold’s latest advance, which is on track to record its seventh consecutive higher weekly close.

The first support level to watch sits around $3,450. Retracements to this area would likely attract buying interest near the upper range of the recent four-month consolidation period.

Bulls ’ failure to defend this key level could see the commodity’s price retreat to $3,120. This location on the chart may provide support near the May low, which currently sits just above the upward sloping 50-week moving average.

Finally, a more-significant decline opens the door for a retest of lower support around $2,790. Investors could look for longer-term buy-and-hold opportunities in this area near last year’s notable October peak.

The comments, opinions, and analyses expressed on Investopedia are for informational purposes only. Read our warranty and liability disclaimer for more info.

As of the date this article was written, the author does not own any of the above securities.

Read the original article on Investopedia

The first support level to watch sits around $3,450. Retracements to this area would likely attract buying interest near the upper range of the recent four-month consolidation period.

Bulls ’ failure to defend this key level could see the commodity’s price retreat to $3,120. This location on the chart may provide support near the May low, which currently sits just above the upward sloping 50-week moving average.

Finally, a more-significant decline opens the door for a retest of lower support around $2,790. Investors could look for longer-term buy-and-hold opportunities in this area near last year’s notable October peak.

The comments, opinions, and analyses expressed on Investopedia are for informational purposes only. Read our warranty and liability disclaimer for more info.

As of the date this article was written, the author does not own any of the above securities.

Read the original article on Investopedia