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A Big Move In Gold Is Coming

Commentaries & Views

For the past month, gold has languished at the bottom end of the range, using $1,260- $1,270 as a floor, bouncing each time. Most markets, when caught in a consolidation pattern, will break out one way or the other in time. The longer they stay in this pattern, the more powerful the move will be in either direction.

To make a case for the downside is very difficult; there is not a lot of data that would indicate the breakout will be to the downside. The recent strength in the U.S. dollar has not affected the metals, and the biggest bull stock market in history has not really hurt the price of gold. The bottom end of the range appears to be strong, making a break to the downside unlikely.

Metals look like they are ready to break out to the upside. The gold bears have been pushing for months and have not been successful in pushing gold below the key support level. The expected rally will not be easy, but the metals market certainly feels like it wants to break out to the upside and test the $1,310 level.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.
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