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When Gold was trading at $1,600 per ounce, the Power of the Pattern suggested Gold should trade up to $1,900 and then run into SERIOUS RESISTANCE! (See post here) The advice at that time…”We are long Gold at this time and we will Look to harvest long Gold positions when it hits resistance.”
Another reason I suggested that Gold be harvested was….Gold was becoming a crowded trade, with GLD becoming the largest ETF on the planet!!! (See post here)
Now a year and a half later, Gold finds itself $300 lower in price. What has the U.S. Dollar done over the past 18 months? The US$ has gained 13% while Gold has declined 15%. Is the Dollar the reason that Gold is declining in price?
The Dollar of late is doing something it hasn’t done in 10-years, its breaking above a falling channel that has contained it for 10 years. The breakout becomes very important for Gold, because as the US$ is breaking resistance, Gold is on a 10-year steep rising support line at (2) in the chart below.
Is the breakout in King Dollar what is causing pricing pressure on other commodities outside of Gold, like Copper as well?
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Resistance is resistance until broken! The above chart reflects that each time Gold hit the top of its rising channel it paused for a while, often moving to the bottom of the channel where it would find support.
Support is Support until broken! Gold now finds itself on 10-year rising support, after breaking below its 100-week SMA line at (2). It’s big-time important for Gold to hang on to support here, because a break of this support line would usher in a new round of selling!
Due to the importance the metals complex finds itself at right now and what the impact the US$ could have on other assets should it continue to rally, we will be introducing a new “Metals Research Report” in the new few weeks that will focus on the metals complex, providing in-dept research and pattern analysis on Gold, Copper, Silver, Platinum, Gold & Silver miners stocks only. (This report will be free to Premium Members).
From a Power of the Pattern perspective, patterns suggest Gold prices will be at much higher levels in the long-term.
In our new research report I will reveal at what price points investors will want to back up the truck and be an aggressive buyer of Gold!
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