The Gold markets initially pulled back during the week, but then found enough support at the uptrend line of the ascending triangle to turn things around and break above the crucial $1450 level.
The gold market has broken to the upside and above the crucial $1450 level, an area that has offered a lot of resistance as of late. The fact that we are up here now, tells me that we are ready to take on the $1500 level, an area that should be psychologically and structurally important. If we can break above that level, then the market is likely to go much higher. At this point, I believe that the market is going to come back and find buyers on any dip that occurs. There is a serious “risk off” attitude out there right now, and I don’t think that’s going to change anytime soon.
While I do recognize that $1500 is going to be difficult to break above, I think it does happen given enough time. Quite frankly, there’s far too many things out there to spook the markets to think that we are going to break down suddenly. Quite frankly, I think gold has entered a larger and longer timeframe bullish run. The recent consolidation has made the market digest the parabolic move previously, and now it looks like we are going to see more of the same. At this point, I believe the $1400 level should offer significant support. Any support in that area should continue to see people being interested in buying.
If we did break down below the $1400 level, then the next support level is the $1350 level. Quite frankly, at this point I would be somewhat stunned to see that level gets broken. I have no interest in selling.
Source: FX Empire