Gold shows continued resilience
Onwards and upwards. Gold put in another strong performance yesterday, and has built on those gains this morning. The significant thing about Tuesday’s performance was that gold was able to break above resistance in the $2,720 area with apparent ease. In fact, it was textbook price action. Gold sliced through resistance, ran on, and then dropped back to retest resistance as support. This held, allowing gold to tack on another $40 taking it within relatively easy reach of its all-time high of $2,790 from late October. The daily MACD shows that momentum continues to point upwards, and while stretching further into positive territory, it is not yet at overbought levels. That’s not to conclude that gold can easily take out its record high without some pullback or consolidation, although it’s certainly possible. If it does manage to push up further, the next test will be how it behaves if it makes a fresh record high. Looking back, history suggests that a sell-off will follow. We may find out soon enough.
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