Gold price rally showing good follow through strength today – up 3.5% on the week
After the gold price yesterday closed well above its 200 daily moving average there has been some great follow through today.
Back on August 14th when the price of gold was bang on $1600 we noted:
As the slow summer month continues the gold price has drifted back to around $1600 – but when you take a look at the chart pattern forming it’s clear to see that the wedge formation, that has been nearly 3 months in the making, is going to have to break either way and soon…
From a charting perspective the formation is very bullish and a break-out to the upside could see the shorts cover quickly and that longer-term resistance level (which will be in the $1670 area by the start of September) come into play.
We published this chart to go with it:
(click for sharper image)
Just a week and a half later the gold price has done this:
(click for sharper image)
Bang on that $1670 level we stated. That’s a 3.5% move so far this week.
It will be very interesting to see how long it takes for the bulls to push through that long-term overhead resistance, but the way the gold market is trading at the moment it would appear that it shouldn’t take long at all (last check $1673).
If gold can close above $1661 tomorrow it will be gold’s best weekly close since the beginning of March.
In terms of € gold if these levels can hold going into the close tomorrow it will mean that it will have its second highest weekly gold close ever. You have to go all the way back to the start of September 2011 when € gold had a higher weekly close.
Gold €:
(click for sharper image)
Gold € weekly:
(click for sharper image)
In terms of £ gold that start of June close of £1055 still needs to be cleared, something that is now only a couple of pounds away.
Gold £:
(click for sharper image)
All in all this move should be seen as very bullish and we suspect will of caught many by surprise. Thankfully that dreary near 4 months of range trading looks to be officially over.
Related posts:
- Last friday’s gold price rally following through this week
- As UK producer prices come in higher than expected will next week’s CPI follow suit?
- The gold price ends the month of May up in Euro terms – but dollar strength continues to hold it back
- Is the gold price going to party like it’s 2007? The striking resemblance between 2007 and today
- Gold price softer today after closing at the top of its ‘box’
Link to this article: : http://www.goldmadesimplenews.com/gold/gold-price-rally-showing-good-follow-through-strength-today-up-3-5-on-the-week-7731/
Posted by Jason Cozens on Aug 23 2012. Filed under Gold News.
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