Can The Bottoms Hold?
Kitco Commentaries | Opinions, Ideas and Markets Talk
Featuring views and opinions written by market professionals, not staff journalists.
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.