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Gold Building Higher Base

Commentaries & Views

Gold proved that $1,180 was a great support level and now is trying to confirm a higher low at $1,220. The breakout through the $1,220 level was a classic blow-off trade -- continued failure at a level and then an explosion through as we saw on Oct. 11.

After making higher lows, which set up the big move higher, gold is repeating that same pattern, and our expectations are to see the pattern repeat. Blow-offs in either direction are resolved in a couple of different ways.

Now that gold has resumed a consolidation pattern, it is doing so at yet another higher low, which is $1,220. The new range for gold is $1,220-$1,240. We will hold longs as long as the level holds. Our expectations are for a breakout to the upside with the next test at $1,275.

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.