Gold’s Two-Month Break Faces $4,125 Test and $4,175 Target

By Grace Kim

Gold’s proposed upside path runs $4,137, $4,157 and $4,159-$4,175 after a nearly two-month descending-channel break, according to TradingView author pejman_zwin.

What does gold’s two-month break change?

Gold entered the new trading week with bullish momentum and started testing a Resistance Zone of $4,122-$4,067, pejman_zwin wrote in his 1-hour analysis of OANDA:XAUUSD.

The author said price appeared to have broken above the Descending Channel that had controlled the market for nearly two months. He identified the $4,122-$4,067 area as the next major challenge.

pejman_zwin cautioned that a channel breakout becomes more reliable when price holds above the broken structure and confirms the move through nearby resistance.

In his framework, the trend has turned bullish, but the $4,122-$4,067 zone remains the immediate test before the higher targets.

What supports gold?

pejman_zwin credited falling oil prices, a weaker U.S. Dollar and lower Treasury yields for supporting the rally. He also identified strong central-bank demand as a positive factor.

China supplied a specific marker for that demand. The country added about 26 tonnes of gold to its reserves in October, which pejman_zwin said supported the longer-term demand outlook.

His support list spans three macroeconomic forces—oil, the dollar and Treasury yields—and official-sector buying.

Those four inputs form the stated foundation for his bullish case, although the author treats the coming U.S. inflation data as the next major catalyst.

How could U.S. inflation change the setup?

Strong U.S. employment data pushed expectations for a December Fed rate hike to around 81%, pejman_zwin said. He presented that backdrop as a counterweight to the rally.

The author identified the next session’s U.S. CPI report as the next major catalyst. He said softer inflation could support gold, while hotter inflation could trigger renewed selling pressure.

U.S. inflation is therefore the immediate fundamental test in his setup, with the proposed $4,051.8 stop defining the downside risk.

What do the Elliott Wave counts show?

From an Elliott Wave perspective, pejman_zwin said gold appeared to have completed Primary Wave 4. That setup potentially opens a path to a bullish Primary Wave 5.

The count supports his bullish case, but the author still set $4,125 as the practical confirmation level.

pejman_zwin said: “I expect bullish momentum to continue as U.S. financial markets open.”

Until price confirms above $4,125, the two-month channel break remains the chart’s central test in his analysis.

Where are the trading targets?

pejman_zwin mapped a staged setup on the 1-hour chart, with two take-profit levels and one stop-loss level.

• Confirmation level: $4,125.
• First Take Profit (TP): $4,137.
• Second Take Profit (TP): $4,157.
• Potential Reversal Zone (PRZ): $4,159-$4,175.
• Stop Loss (SL): $4,051.8.
• Key Trading Levels: $4,125-$4,175.

A confirmed break above $4,125 could carry gold to $4,137, pejman_zwin said. If momentum strengthens, $4,157 becomes the next target, followed by the $4,159-$4,175 PRZ near the dynamic resistance of the 21_SMA (Weekly).

The author considered the reaction around that zone important. pejman_zwin said: “The reaction around this area will be especially important for determining whether the rally can continue.”

He also instructed traders to use proper risk management and set a Stop Loss for every position. His two reference levels were $4,157 on the upside and $4,051.8 on the downside.

The coming session will test whether gold can hold its two-month channel break above $4,125, while the next U.S. CPI report supplies the fundamental test for the proposed path to $4,137 and $4,157.