I can hear you think: just now a buying opportunity for trend followers? The price has been on the rise since 1180, now stands at 1371, so the 16% rally is already behind us. True, the recent upswing on my chart, the weekly one, was a significant recovery in the downtrend. Short-term players, who follow the daily chart, have already noticed an earlier uptrend. That is simply the result of the chosen chart. Take a look at the 10 year gold chart for instance, even there you can see that the blue line is about the cross the green one.
Anyway, back to the weekly chart which has now plenty of technical ingredients to spark a buying signal - though with a warning. The price crosses the 55 SMA line, my trend following indicator which implies the start of an upwards trend. This happens with a white weekly candle and swing counter at +1. My swing counter is an accelerometer, which in this case signals an upswing. Often a swing of at least 9 candles. The RSI 14, as a strength gauge, is in overbought territory and that's too bad. Usually that means a top formation, and that would signal a slowdown for the recently begun uptrend. It is an uptrend with a false start?
The first indications of a new trend are emerging. Bargain hunters are already buying some to get a taste of the breakout movement to 1434, the first red line on the chart. Then it's likely that there will be a pullback, also caused by the already high RSI, where the average line will be tested as a trend line with a range to 1328, the green support line on the chart.
In the event a black candle will appear in the upcoming week, it will put pressure on the support level, then there's certainly a false start. An exciting phase, but a great opportunity for traders to catch the beginning of a upward gold trend.