This type of triangle chart pattern occurs when there is a resistance level and a slope of higher lows. What happens during this time is that there is a certain level that the buyers cannot seem to exceed. However, they are gradually starting to push the price up as evident by the higher lows. In the chart above, you can see that the buyers are starting to gain strength because they are making higher lows. They keep putting pressure on that resistance level and as a result, a breakout is bound to happen. Many charting books will tell you that in most cases, the buyers will win this battle and the price will break out past the resistance. However, it has been our experience that this is not always the case. Sometimes the resistance level is too strong, and there is simply not enough buying power to push it through.
Adding a series of divergence on RSI 14 makes it even more confluent. Is it time for GOLD to make a pullback? Let me know your thoughts in the comment section.
Adding a series of divergence on RSI 14 makes it even more confluent. Is it time for GOLD to make a pullback? Let me know your thoughts in the comment section.
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