Last week I penned a post called ‘Patience required for gold bugs’ as the precious metal approached the $1800 per ounce level once more, a region which has proved to be hard to overcome. This is what I said in the post:
In terms of resistance ahead, there is very little and as we can see from a volume-based resistance perspective, this is falling away dramatically on the volume point of control histogram, so provided we see the price action supported with good volume, gold should break above this area with relative ease. So once again for gold bugs, it is a question of being patient and waiting for the move through the psychological $1800 per ounce price point and once this has been breached, expect to see gold develop the bullish trend further using the current congestion as the springboard for the move higher.
So I’m delighted to report that this patience has been duly rewarded with a strong move through on Tuesday, with the price action closing with the candle not only closing with a wick to the bottom but it was also wide spread up candle on good volume and confirming the breakaway as being valid. This was further confirmed in yesterday’s gold trading session with the precious metal continuing to move higher with further gains in early trading today and now trading at $1823.20 per ounce at the time of writing. And more importantly, rising price with rising volume confirming the move. The trend monitor indicator has been confirming and maintaining the bullish signal since the middle of last month and now with an excellent platform of support in place we can expect to see gold develop a longer-term bullish trend and one which may breach the $2000 per ounce area in the longer term with key levels on this route higher at $1826, $1840 & $1875 in the short term.
By Anna Coulling
Charts from NinjaTrader and indicators from Quantum Trading
Anna, most of the up price on the precious metals is due to the smashing of the rigged market of the banksters and bullion dealers on the paper market.