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Can The Bottoms Hold?

Commentaries & Views

Gold’s struggles appear to be over for now. After bottoming on May 21, gold quietly rallied and has built a solid base, clearing the way for higher prices. The rally came from oversold conditions; however, it was not a dead-cat bounce or short-covering rally; it was simply a great technical spot to enter.

This rally is making higher highs and higher lows, which should bring gold to the first resistance of $1,310, which was the level it failed from. We expect a slow grinding rally on volume. The tape action is bullish, volume is building, and the buyers appear to be new money -- all bullish signs.

Although there is still the chance that gold could test the $1,260 level, we feel the bottoms are in and gold should test the $1,365 level. The long-term pattern looks great and the rally is on.

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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