Gold weekend update

Following yesterday's post gold rallied from 1421 and showed no sign of stopping at the red channel support I showed with the red oval. The fact that red channel played no role here was kind of fishy. Well, this is the thing with channels. You have to look into all options before drawing conclusions. Apparently, the blue channel was in charge yesterday which may turn to a bull flag but it needs to hit the upper band for the third time for this option to become a possibility.

On the longer term chart, we can see why gold couldn't go too far within the green rising channel above. It tested the orange resistance maybe 6 times before the recent drop. This doesn't mean it can't. If the blue channel above turns out to be a bull flag, the consolidation may well give gold the opportunity to take a breath before breaking that resistance the next time. Hope it helps.