Rangebound since 2014, there is a very good excuse to speculate on some coming growth for gold.
The price of gold appears on the verge of becoming properly interesting again. Of course, this has only occurred since we started to speculate whether bitcoin was becoming the new ‘contrary' indicator for the markets, overall. But now, something quite useful seems to be awakening gold from its recent slumbers.
Perhaps we're being churlish, describing the metal stuck in a $300 range since 2014 as a "slumber", but a glance at the chart below illustrates, despite it going up and down a bit, we'd need to be generous to attribute any link to gold behaviour with, for instance, Dow Jones behaviour.
However, all this appears to be on the point of changing, but with an important caveat. If the metal actually closes a day above $1,350 dollars – or trades beyond $1,357 dollars – there is a very reasonable excuse to speculate on some coming reasonable growth.
Visually, there's a historical issue at the $1,350 level, thanks to a glass ceiling being in place since June 2014. If we forget arithmetic and simply use common sense, once the shiny stuff is seen solidly exceeding this Glass Ceiling (or Flat Trend), a majority of traders will assume, correctly we suspect, that gold is heading skyward.
Thus far, we've only one reservation regarding its prospects, and we've circled it on the chart.
The price broke the ‘blue' downtrend at $1,288 dollars. Since the point of trend break, the metal has closed a couple of sessions below the point of trend break. This sort of thing tends to dampen enthusiasm for the future, along with fouling our calculations.
For now, we can calculate trades above $1,357 should bring an initial $1,385 within range. If such a level is bettered, our secondary calculates at $1,401 dollars though, to be honest, it could easily continue acceleration toward $1,537, a level where some hesitation seems essential.
Source: Trends and Targets Past performance is not a guide to future performance
Alistair Strang has led high-profile and "top secret" software projects since the late 1970s and won the original John Logie Baird Award for inventors and innovators. After the financial crash, he wanted to know "how it worked" with a view to mimicking existing trading formulas and predicting what was coming next. His results speak for themselves as he continually refines the methodology.
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