As this chart shows, gold has traced out a potentially bullish symmetrical triangle pattern – one which typically leads to a dramatic upside breakout.
The symmetrical triangle pattern is sometimes referred to as a ‘coiled spring’ and often marks a continuation of the current trend (which for gold is obviously up). A breakout to the upside could quickly send gold to $2,083 an ounce.
Chart courtesy of Stockcharts.com. Note the Declining volume which helps validate the pattern.
Roughly 75% of symmetrical triangle patterns are continuation patterns, however some do mark reversals and we won’t know the direction of gold’s next major move until after we have seen a valid breakout.